Cross-sectional heterogeneity in price-cost margins and the extent of rent sharing at the sector and firm level in France

Arbeitspapier

This paper studies cross-sectional heterogeneity in price-cost margins and the extent of rent sharing among 48 sectors and 10738 (mainly manufacturing) firms in France. At the sectoral level, the average price-cost mark-up and the average extent of rent sharing amount to 1.701 and 0.368 respectively. Ignoring the occurrence of rent sharing reduces the average price-cost mark-up to 1.500. At the firm level, the average parameters are estimated at 1.814 and 0.558 respectively. Using the Swamy (1970) methodology which corrects the observed heterogeneity for sampling heterogeneity, the corresponding estimates of their robust true dispersion are 0.694 and 0.204. Excluding the existence of rent sharing brings the firm-level average price-cost mark-up down to 1.491. The corresponding robust true dispersion amounts to 0.493.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: IZA Discussion Papers ; No. 1898

Classification and Topics

• Classification: Wirtschaft ; Single Equation Models; Single Variables: Panel Data Models; Spatio-temporal Models ; Firm Behavior: Theory ; Labor-Management Relations, Trade Unions, and Collective Bargaining: General ; Oligopoly and Other Imperfect Markets
• Subject: rent sharing ; price-cost margins

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Dobbelaere, Sabien ; Mairesse, Jacques
• Event: Veröffentlichung
• (who): Institute for the Study of Labor (IZA)
• (where): Bonn
• (when): 2005

Further information

• Handle: http://hdl.handle.net/10419/33242
• Last update: 10.03.2025, 11:41 AM CET