1. About the IWH
  2. Team
  3. Economists

Dr Matthias Mertens

Dr Matthias Mertens
Current Position

since 10/19

Head of IWH-CompNet-Team

Halle Institute for Economic Research (IWH) – Member of the Leibniz Association

since 10/15

Economist in the Department of Structural Change and Productivity

Halle Institute for Economic Research (IWH) – Member of the Leibniz Association

Research Interests
  • firm productivity
  • product and input market power
  • allocation of production factors

Matthias Mertens joined the Department of Structural Change and Productivity in October 2015. He is the coordinator of the scientific team of CompNet and head of the IWH-CompNet-Group since October 2019. His research focuses on firm productivity, product and input market power, and factor allocation.

Matthias Mertens received his bachelor's and master's degree from Martin Luther University Halle-Wittenberg and his PhD from Otto von Guericke University Magdeburg.

Your contact

Dr Matthias Mertens
Dr Matthias Mertens
Mitglied - Department Structural Change and Productivity
Send Message +49 345 7753-707 Personal page

Publications

European Firms after the Crisis – New Insights from the 5th Vintage of the CompNet Firm-level-based Database

Elena Ashtari Tafti Richard Bräuer Sante De Pinto Marco Grazioli Matthias Mertens Daniel Stöhlker Marta Tagliabue

2016

Abstract

This report intends to shed light on the competitive stance of European firms after the crisis. In line with CompNet cutting-edge approach, we take a firm-level perspective to analyse the competitive position of European firms by drawing from the new vintage of the firm-level-based CompNet database. This micro-level approach allows us to ascertain the extent in which firms performances are heterogeneous across EU, also in relation of possible determinants of such performance.

read publication
cover_book_die-wirkungen-von-handelsliberalisierungen.jpg

Die Wirkungen von Handelsliberalisierungen: Ein Vergleich zwischen dem Melitz-Ansatz und der endogenen Wachstumstheorie

Matthias Mertens

in: Springer Gabler, Wiesbaden, 2016

Abstract

Matthias Mertens diskutiert Vor- und Nachteile des Melitz- und des endogenen Wachstumsansatzes hinsichtlich der Analyse von (Wohlfahrts-)Effekten einer Handelsliberalisierung und zeigt, dass beide Ansätze eine Daseins-Berechtigung besitzen, da sie verschiedene Handelsliberalisierungsaspekte in den Fokus setzen. Die Arbeit ermöglicht eine einfache Modellauswahl für die Analyse relevanter handelspolitischer Fragestellungen und Anwendungsfälle. Weiterhin verdeutlicht der Autor das Zukunftspotential hybrider Ansätze, welche endogene Wachstumsmodelle und Melitz-Modelle miteinander kombinieren und zur Entwicklung einer generalisierten Modelltheorie für die Analyse von Handelsliberalisierungswirkungen beitragen können.

read publication
cover_IWH-CompNet-DP_03_2019.jpg

Micro-mechanisms Behind Declining Labour Shares: Market Power, Production Processes, and Global Competition

Matthias Mertens

in: IWH-CompNet Discussion Papers, No. 3, 2019

Abstract

This article investigates how changing production processes and increasing market power at the firm level relate to a fall in Germany’s manufacturing sector labour share. Coinciding with the fall of the labour share, I document a rise in firms’ product and labour market power. Notably, labour market power is a more relevant source of firms’ market power than product market power. Increasing product and labour market power, however, only account for 30% of the fall in the labour share. The remaining 70% are explained by a transition of firms towards less labour-intensive production activities. I study the role of final product trade in causing those secular movements. I find that rising foreign export demand contributes to a decline in the labour share by increasing labour market power within firms and by inducing a reallocation of economic activity from nonexporting- high-labour-share to exporting-low-labour-share firms

read publication
cover_DP_2019-20.jpg

Import Competition and Firm Productivity: Evidence from German Manufacturing

Richard Bräuer Matthias Mertens Viktor Slavtchev

in: IWH Discussion Papers, No. 20, 2019

Abstract

This study analyses empirically the effects of import competition on firm productivity (TFPQ) using administrative firm-level panel data from German manufacturing. We find that only import competition from high-income countries is associated with positive incentives for firms to invest in productivity improvement, whereas import competition from middle- and low-income countries is not. To rationalise these findings, we further look at the characteristics of imports from the two types of countries and the effects on R&D, employment and sales. We provide evidence that imports from high-income countries are relatively capital-intensive and technologically more sophisticated goods, at which German firms tend to be relatively good. Costly investment in productivity appears feasible reaction to such type of competition and we find no evidence for downscaling. Imports from middle- and low-wage countries are relatively labour-intensive and technologically less sophisticated goods, at which German firms tend to generally be at disadvantage. In this case, there are no incentives to invest in innovation and productivity and firms tend to decline in sales and employment.

read publication
cover_International_Journal_of_industrial_organisation_70_2020.png

Labor Market Power and the Distorting Effects of International Trade

Matthias Mertens

in: International Journal of Industrial Organization, No. 102562, 2020

Abstract

This article examines how final product trade with China shapes and interacts with labor market imperfections that create market power in labor markets and prevent an efficient market outcome. I develop a framework for measuring such labor market power distortions in monetary terms and document large degrees of these distortions in Germany's manufacturing sector. Import competition only exerts labor market disciplining effects if firms, rather than employees, possess labor market power. Otherwise, increasing export demand and import competition both fortify existing distortions, which decreases labor market efficiency. This widens the gap between potential and realized output and thus diminishes classical gains from trade.

read publication
cover_compnet_05_2020.png

Firm Productivity Report

Annalisa Ferrando Tibor Lalinsky Phillip Meinen Ottavia Papagalli Roberta Serafini Johannes Amlung Tommaso Bighelli Roman Blyzniuk Marco Christophori Jonathan Deist Mirja Hälbig Peter Haug Matthias Mertens Verena Plümpe Filippo di Mauro Sergio Inferrera Marc Melitz

in: CompNet - The Competitive Research Network, 2020

Abstract

As we enter a second phase of the COVID-pandemic, in which we attempt to reopen economies and foster growth, investigating the efficiency and productivity of firms becomes essential if we wish to design the appropriate policies. The 2020 Flagship Firm Productivity report provides a comprehensive account of how productivity is changing –and what is driving those changes –in Europe, drawing from granular firm-level information.Although it was written before the crisis erupted, this report can therefore offer critical insights to current policymaking andprovides grounds for future research.

read publication

Working Papers

cover_DP_2019-20.jpg

Import Competition and Firm Productivity: Evidence from German Manufacturing

Richard Bräuer Matthias Mertens Viktor Slavtchev

in: IWH Discussion Papers, No. 20, 2019

Abstract

This study analyses empirically the effects of import competition on firm productivity (TFPQ) using administrative firm-level panel data from German manufacturing. We find that only import competition from high-income countries is associated with positive incentives for firms to invest in productivity improvement, whereas import competition from middle- and low-income countries is not. To rationalise these findings, we further look at the characteristics of imports from the two types of countries and the effects on R&D, employment and sales. We provide evidence that imports from high-income countries are relatively capital-intensive and technologically more sophisticated goods, at which German firms tend to be relatively good. Costly investment in productivity appears feasible reaction to such type of competition and we find no evidence for downscaling. Imports from middle- and low-wage countries are relatively labour-intensive and technologically less sophisticated goods, at which German firms tend to generally be at disadvantage. In this case, there are no incentives to invest in innovation and productivity and firms tend to decline in sales and employment.

read publication
Browse all working papers

Keywords

Productivity
Mitglied der Leibniz-Gemeinschaft LogoTotal-Equality-LogoWeltoffen Logo