Our @OECD Working Paper is out: https://www.oecd-ilibrary.org/science-and-technology/scale-market-power-and-competition-in-a-digital-world_c1cff861-en We know there’s an issue between the market power of big and small firms. Big firms tend to have more of it, and the gaps are increasing over time. Digitisation might be playing a role. But what role? Threeaaad

There’s a perception that technology is inherently disruptive, and it *can* be, as @benthompson's writing repeatedly shows us. But we show technology can also reinforce the market power of dominant firms because of its key characteristics.

Only when technology fundamentally changes products and the distribution of products do we see genuine disruption. Incremental advances in tech. favours the big firms.

What we do is to look at a dataset with > 400,000 firms across 26 countries from 2001 to 2014. We split the firms into size groups to see if there are systematic differences between firms based on their size. Spoiler: There are!

And what are these differences? Larger firms have higher sales growth, and are more profitable over time. This squares with the work of @johnvanreenen, @jan_eeckhout, Nick Bloom and others.

Larger firms have higher mark ups and are more productive. This is particularly true for digital intensive firms. Intangible assets may play a role here, echoing @carolcorrado, @erikbryn, and others' work.

These increases in markup and productivity are getting bigger over time, which should be of key interest to policy makers in @DeptEnterprise and others.

We see similar findings when we look at productivity, which suggests technological factors might be playing a role.

There’s a bunch of limitations to this work. We don’t have firm-level measures of digital technologies, sadly. All the trends we study are at the industry level. It’s harder to tease out the impact of technology and other intangible assets without firm-level data.

We will look at intangibles & scale using firm-level data. In our next paper, we will. This is an output of a project between @OECD's @Sara_Calligaris, @C_Criscuolo, Eleanor Doyle of @CUBSucc, all lead by Michael McMahon of @BusinessAtUL. Paper again: https://www.oecd-ilibrary.org/science-and-technology/scale-market-power-and-competition-in-a-digital-world_c1cff861-en