#industrialorganization — Public Fediverse posts on home.social

Dennis Alexis Valin Dittrich @[email protected] · 2025-10-22 · 21:05 UTC

The Labor Market Consequences of Acquisitions https://d.repec.org/n?u=RePEc:ces:ceswps:_12162&r=&r=ind
"… the consequences of corporate acquisitions for workers and find that they are far from neutral: earnings decline through both job displacement and wage cuts among stayers from target firms. These wage cuts do not reflect increased monopsony power. Instead, they are concentrated in acquisitions where the acquirer’s CEO sat on the target’s board prior to the transaction, suggesting insider knowledge of pay policies.
… such CEOs disproportionately acquire high-paying firms and subsequently reduce wages. The result is rent redistribution from workers to shareholders and managers, as seen in higher profits and CEO pay. These findings imply that the labor-market risks of acquisitions arise not only from greater market concentration, as documented in previous work, but also from managerial incentives that conventional antitrust policies are ill-equipped to address."
#LaborEcon #wages #IndustrialOrganization

#laborecon #wages #industrialorganization

Dennis Alexis Valin Dittrich @[email protected] · 2025-10-22 · 21:05 UTC

The Labor Market Consequences of Acquisitions https://d.repec.org/n?u=RePEc:ces:ceswps:_12162&r=&r=ind
"… the consequences of corporate acquisitions for workers and find that they are far from neutral: earnings decline through both job displacement and wage cuts among stayers from target firms. These wage cuts do not reflect increased monopsony power. Instead, they are concentrated in acquisitions where the acquirer’s CEO sat on the target’s board prior to the transaction, suggesting insider knowledge of pay policies.
… such CEOs disproportionately acquire high-paying firms and subsequently reduce wages. The result is rent redistribution from workers to shareholders and managers, as seen in higher profits and CEO pay. These findings imply that the labor-market risks of acquisitions arise not only from greater market concentration, as documented in previous work, but also from managerial incentives that conventional antitrust policies are ill-equipped to address."
#LaborEcon #wages #IndustrialOrganization

#laborecon #wages #industrialorganization

Dennis Alexis Valin Dittrich @[email protected] · 2025-10-22 · 21:05 UTC

The Labor Market Consequences of Acquisitions https://d.repec.org/n?u=RePEc:ces:ceswps:_12162&r=&r=ind
"… the consequences of corporate acquisitions for workers and find that they are far from neutral: earnings decline through both job displacement and wage cuts among stayers from target firms. These wage cuts do not reflect increased monopsony power. Instead, they are concentrated in acquisitions where the acquirer’s CEO sat on the target’s board prior to the transaction, suggesting insider knowledge of pay policies.
… such CEOs disproportionately acquire high-paying firms and subsequently reduce wages. The result is rent redistribution from workers to shareholders and managers, as seen in higher profits and CEO pay. These findings imply that the labor-market risks of acquisitions arise not only from greater market concentration, as documented in previous work, but also from managerial incentives that conventional antitrust policies are ill-equipped to address."
#LaborEcon #wages #IndustrialOrganization

#laborecon #wages #industrialorganization

Dennis Alexis Valin Dittrich @[email protected] · 2025-10-22 · 21:05 UTC

The Labor Market Consequences of Acquisitions https://d.repec.org/n?u=RePEc:ces:ceswps:_12162&r=&r=ind
"… the consequences of corporate acquisitions for workers and find that they are far from neutral: earnings decline through both job displacement and wage cuts among stayers from target firms. These wage cuts do not reflect increased monopsony power. Instead, they are concentrated in acquisitions where the acquirer’s CEO sat on the target’s board prior to the transaction, suggesting insider knowledge of pay policies.
… such CEOs disproportionately acquire high-paying firms and subsequently reduce wages. The result is rent redistribution from workers to shareholders and managers, as seen in higher profits and CEO pay. These findings imply that the labor-market risks of acquisitions arise not only from greater market concentration, as documented in previous work, but also from managerial incentives that conventional antitrust policies are ill-equipped to address."
#LaborEcon #wages #IndustrialOrganization

#industrialorganization #wages #laborecon

Dennis Alexis Valin Dittrich @[email protected] · 2025-10-22 · 21:05 UTC

The Labor Market Consequences of Acquisitions https://d.repec.org/n?u=RePEc:ces:ceswps:_12162&r=&r=ind
"… the consequences of corporate acquisitions for workers and find that they are far from neutral: earnings decline through both job displacement and wage cuts among stayers from target firms. These wage cuts do not reflect increased monopsony power. Instead, they are concentrated in acquisitions where the acquirer’s CEO sat on the target’s board prior to the transaction, suggesting insider knowledge of pay policies.
… such CEOs disproportionately acquire high-paying firms and subsequently reduce wages. The result is rent redistribution from workers to shareholders and managers, as seen in higher profits and CEO pay. These findings imply that the labor-market risks of acquisitions arise not only from greater market concentration, as documented in previous work, but also from managerial incentives that conventional antitrust policies are ill-equipped to address."
#LaborEcon #wages #IndustrialOrganization

#laborecon #wages #industrialorganization

Dennis Alexis Valin Dittrich @[email protected] · 2025-03-17 · 21:46 UTC

More regulations might cause more concentration https://freemarketalternative.blogspot.com/2025/03/more-regulations-might-cause-more.html
"Complicated regulations create a fixed cost for established companies that they handle with divisions of specialists. But for startups with few employees and little capital, these #regulations act as direct #barriersToEntry

… provide some evidence that the increase in concentration can be explained by increasing regulations."
#economics #IndustrialOrganization

#regulations #barrierstoentry #economics #industrialorganization

Dennis Alexis Valin Dittrich @[email protected] · 2025-03-07 · 13:25 UTC

Labor share and market power in European firms https://d.repec.org/n?u=RePEc:pra:mprapa:123442&r=&r=lma
"firms’ product and labor market power, as reflected in product markups and labor markdowns, enable firms to capture a larger share of economic output at the expense of workers.
… empirical analysis shows that markdowns are negative correlated with labor share, as firms reduce employment and suppress #wages below the marginal revenue of labor.
Product markups exhibit a dual effect: they can positively influence the labor share by increasing wages and employment when firms reinvest additional profits into production expansion. … markups indirectly reduce the labor share due to their positive link with labor markdowns. Firms with significant pricing power often suppress wages and limit hiring, diminishing the labor share.
… empirical results reveal the presence of a hump-shaped relationship between product markups and labor share. Initially, as product markups increase, the labor share rises, but this trend reverses when markups reach high levels. This nonlinearity underscores the dual nature of markups: while moderate markups have a direct positive effect on labor share, mitigating labor markdowns, high markups enable firms to exert substantial #monopsony power, diminishing the labor share.
The analysis reveals significant cross-country #heterogeneity in the effects of markups and markdowns on the labor share."
#IndustrialOrganization #LaborMarkets

#wages #monopsony #heterogeneity #industrialorganization #labormarkets

Dennis Alexis Valin Dittrich @[email protected] · 2025-01-06 · 23:11 UTC

Deep Q-learning of prices in oligopolies: the number of competitors matters
https://www.sfb1283.uni-bielefeld.de/preprints/sfb24074.pdf
"…whereas in a duopoly setting DQNs might lead to prices very close to the monopoly level, the supra-competitive #pricing resulting from the interaction of these algorithms quickly vanishes as the number of firms increases. In particular, markets with at least five competitors robustly yield prices close to the Nash equilibrium level. These findings are robust concerning changes in the key parameters of the algorithm."

The result reminded me very much of this 20+ year-old #experimentalEconomics paper:
"Two are few and four are many: number effects in experimental oligopolies"
https://doi.org/10.1016/j.jebo.2002.10.002 or https://www.econstor.eu/bitstream/10419/78422/1/bgse12_2001.pdf
…and they cited it, too!

#ML #IndustrialOrganization #GameTheory

#pricing #experimentaleconomics #ml #industrialorganization #gametheory

Dennis Alexis Valin Dittrich @[email protected] · 2024-02-28 · 13:01 UTC

Acquihiring for Monopsony Power http://d.repec.org/n?u=RePEc:bon:boncrc:crctr224_2024_500&r=lma
"… the goal of such acquihires might be to shut down the most relevant labor market competitor. This grants the acquirer #monopsony power over specialized talent. As a consequence, acquihiring may harm employees and be socially inefficient."
#LaborMarkets #IndustrialOrganization #wages