The Rise of Star Firms : Intangible Capital and Competition

There is a divergence in the returns of top-performing firms and the rest of the economy, especially in industries that rely on a skilled labor force, raising concerns about their market power. This paper shows that the divergence is explained by t...

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Main Authors:	Ayyagari, Meghana, Demirguc-Kunt, Asli, Maksimovic, Vojislav
Format:	Working Paper
Language:	English
Published:	World Bank, Washington, DC 2019
Subjects:	SKILLED LABOR COMPETITIVENESS FIRM PRODUCTIVITY CAPITAL INVESTMENT MARKET POWER
Online Access:	http://documents.worldbank.org/curated/en/957151556541265334/The-Rise-of-Star-Firms-Intangible-Capital-and-Competition http://hdl.handle.net/10986/31597

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recordtype	oai_dc
spelling	okr-10986-315972022-09-05T00:21:01Z The Rise of Star Firms : Intangible Capital and Competition Ayyagari, Meghana Demirguc-Kunt, Asli Maksimovic, Vojislav SKILLED LABOR COMPETITIVENESS FIRM PRODUCTIVITY CAPITAL INVESTMENT MARKET POWER There is a divergence in the returns of top-performing firms and the rest of the economy, especially in industries that rely on a skilled labor force, raising concerns about their market power. This paper shows that the divergence is explained by the mismeasurement of intangible capital. Compared with other firms, star firms produce more per dollar of invested capital, have higher growth, innovation, and productivity and are not differentially affected by exogenous competitive shocks. Their pricing power supports their high intangible capital investment. Some exceptional firms may pose concerns due to their potential to foreclose competition in the future. 2019-05-02T17:07:01Z 2019-05-02T17:07:01Z 2019-04 Working Paper http://documents.worldbank.org/curated/en/957151556541265334/The-Rise-of-Star-Firms-Intangible-Capital-and-Competition http://hdl.handle.net/10986/31597 English Policy Research Working Paper;No. 8832 CC BY 3.0 IGO http://creativecommons.org/licenses/by/3.0/igo World Bank World Bank, Washington, DC Publications & Research Publications & Research :: Policy Research Working Paper Europe and Central Asia United States
repository_type	Digital Repository
institution_category	Foreign Institution
institution	Digital Repositories
building	World Bank Open Knowledge Repository
collection	World Bank
language	English
topic	SKILLED LABOR COMPETITIVENESS FIRM PRODUCTIVITY CAPITAL INVESTMENT MARKET POWER
spellingShingle	SKILLED LABOR COMPETITIVENESS FIRM PRODUCTIVITY CAPITAL INVESTMENT MARKET POWER Ayyagari, Meghana Demirguc-Kunt, Asli Maksimovic, Vojislav The Rise of Star Firms : Intangible Capital and Competition
geographic_facet	Europe and Central Asia United States
relation	Policy Research Working Paper;No. 8832
description	There is a divergence in the returns of top-performing firms and the rest of the economy, especially in industries that rely on a skilled labor force, raising concerns about their market power. This paper shows that the divergence is explained by the mismeasurement of intangible capital. Compared with other firms, star firms produce more per dollar of invested capital, have higher growth, innovation, and productivity and are not differentially affected by exogenous competitive shocks. Their pricing power supports their high intangible capital investment. Some exceptional firms may pose concerns due to their potential to foreclose competition in the future.
format	Working Paper
author	Ayyagari, Meghana Demirguc-Kunt, Asli Maksimovic, Vojislav
author_facet	Ayyagari, Meghana Demirguc-Kunt, Asli Maksimovic, Vojislav
author_sort	Ayyagari, Meghana
title	The Rise of Star Firms : Intangible Capital and Competition
title_short	The Rise of Star Firms : Intangible Capital and Competition
title_full	The Rise of Star Firms : Intangible Capital and Competition
title_fullStr	The Rise of Star Firms : Intangible Capital and Competition
title_full_unstemmed	The Rise of Star Firms : Intangible Capital and Competition
title_sort	rise of star firms : intangible capital and competition
publisher	World Bank, Washington, DC
publishDate	2019
url	http://documents.worldbank.org/curated/en/957151556541265334/The-Rise-of-Star-Firms-Intangible-Capital-and-Competition http://hdl.handle.net/10986/31597
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The Rise of Star Firms : Intangible Capital and Competition

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