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Antitrust policies and profitability in non-tradable sectors

Besley, Timothy, Fontana, Nicola and Limodio, Nicola (2020) Antitrust policies and profitability in non-tradable sectors. American Economic Review. ISSN 0002-8282 (In Press)

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Abstract

Firms in tradable sectors are more likely to be subject to external competition to limit market power while non-tradable firms are more dependent on domestic policies and institutions. This paper combines an antitrust index available for multiple countries with firm-level data from Orbis covering more than 10 million firms from 90 countries, covering 20 sectors over 10 years and finds that profit margins of firms operating in non-tradable sectors are significantly lower in countries with stronger antitrust policies compared to firms operating in tradable sectors. The results are robust to a wide variety of empirical specifications.

Item Type: Article
Official URL: https://www.aeaweb.org/journals/aer
Additional Information: © 2020 American Economic Association
Divisions: Economics
School of Public Policy
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Geography & Environment
Subjects: H Social Sciences > HG Finance
H Social Sciences > HB Economic Theory
Date Deposited: 04 Sep 2020 13:03
Last Modified: 02 Feb 2021 00:10
URI: http://eprints.lse.ac.uk/id/eprint/106493

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