Research Articles
Explore cutting-edge research based on CompNet’s micro-aggregated firm-level data and related analytical tools. These articles cover empirical and theoretical insights into productivity, competitiveness, firm dynamics, and structural change.
2025
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Reassessing EU Comparative Advantage: The Role of Technology
Based on a sufficient statistics approach, we show how the state of technology of European industries relative to the rest of the world can be empirically assessed...
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Industrial Policy: New Evidence for the United Kingdom
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Danish productivity and competitiveness in a Globalised World
Danish companies participate in the international division of labour with significant production abroad under Danish ownership, along with products being produced by foreign subsidiaries. There are indications that these activities are largely made possible by the position of strength of the Danish companies and that part of the profits from foreign activities cover the cost of employees and intellectual property rights in Denmark. Overall, there are indications of good productivity and competitiveness in manufacturing, but these trends are best illustrated at industry level and there are industries where things look weaker.
2024
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Reassessing EU Comparative Advantage: The Role of Technology
Based on the sufficient statistics approach developed by Huang and Ottaviano (2024), we show how the state of technology of European industries relative to the rest of the world can be empirically assessed…
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The State of UK Competition
Competitive, well-functioning markets matter to all of us… (trimmed)
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Shaping the Rules of the Game: How Political Capabilities Affect Financial Performance
This study contributes to the growing body of research examining how political capabilities affect firms' financial performance… (trimmed)
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Do Firms’ Political Capabilities Increase Their R&D Investments?
Corporates’ political activities have been identified as important for affecting firm-level innovation outcomes… (trimmed)
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Intangibles in light of Industry-level CompNet Dataset
This paper studies the productivity effects of intangible assets using 9th vintage of the CompNet dataset… (trimmed)
2023
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European Firm Concentration and Aggregate Productivity
This paper derives a European Herfindahl–Hirschman concentration index from 15 micro-aggregated country datasets. In the last decade, European concentration rose due to a reallocation of economic activity toward large and concentrated industries. Over the same period, productivity gains from an increasing allocative efficiency of the European market accounted for 50% of European productivity growth while markups stayed constant. Using country-industry variation, we show that changes in concentration are positively associated with changes in productivity and allocative efficiency. This holds across most sectors and countries and supports the notion that rising concentration in Europe reflects a more efficient market environment rather than weak competition and rising market power.
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Inward Foreign Direct Investment, Superstar Firms and Wage Inequality Between Firms: Evidence from European Regions
Theoretical models and international evidence have established that foreign direct investment is associated with new technologies, productivity gains, higher wages, and wage inequality in the host countries. … We find that foreign direct investment, particularly international superstar firms, contributed to increased wage inequality between firms across European regions.
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Declining Business Dynamism in Europe: The Role of Shocks, Market Power, and Technology
We study the changing patterns of business dynamism in Europe after 2000 using novel micro-aggregated data for 19 countries… We derive a firm-level framework that relates changes in firms’ productivity, market power, and technology to job reallocation and firms’ responsiveness.
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Labor Market Power and Between-Firm Wage (In)Equality
I study how labor market power affects firm wage differences using German manufacturing sector firm-level data (1995–2016)… Using micro-aggregated data covering most economic sectors, I validate key results for multiple European countries.
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Do Larger Firms Have Higher Markups?
Several models posit a positive cross-sectional correlation between markups and firm size… We discuss implications and highlight studying input and output market power within an integrated framework as an important next step.
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Monetary policy and local industry structure
We study how monetary policy affects local market competition in the euro area… The underlying mechanism is a decline (increase) in short-term debt and investment by smaller and medium-size firms relative to large firms following tightening (easing).
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Does skill shortage pay off for nursing staff in Germany? Wage premiums for hiring problems, industrial relations, and profitability
This study investigates the impact of hiring problems, industrial relations, and profitability on wage premia for nursing staff in Germany… Overall, pay increases for nurses in firms with staffing problems; nevertheless, this does not apply to all skilled workers.
2022
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Synergies and gaps between farm and non-farm micro-level data for sustainable rural development
The article discusses the importance of high-quality microdata… However, social and environmental indicators are under-represented in both datasets, limiting the ability to understand drivers of performance in the rural economy.
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Productivity and Business Dynamism in Japan — Comparison with the EU Countries Using Firm-level Data (Japanese)
We measure productivity and determinants of business dynamism for Japanese firms and compare with EU countries (CompNet 8th Vintage)… productivity growth in Japan has stagnated in the 2010s while allocative efficiency deteriorated.
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Corporate economic profits in the euro area: The relevance of cost competitive advantage
We estimate aggregate and industry cost and profit shares for France, Germany, Italy and Spain (1995–2018)… In Germany, rising profits are better explained by cost competitive advantage rather than increasing market power.
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The Geography of the Sharing Economy in Europe
The sharing economy develops unevenly across EU regions… results warn against potential detrimental effects for wage inequalities.
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Increase in Turbulence and Market Power
A sector-specific increase in turbulence accelerates turnover of leaders and mobility across the productivity distribution, reallocating shares toward most productive firms and driving higher markups; the model explains 35–57% of observed markup increases.
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Globalization in Europe: Consequences for the Business Environment and Future Patterns in Light of Covid-19
Involvement in international supply chains is positively related to sector concentration and aggregate productivity, driven by top firms; real-time trade data suggest re-absorption of the Covid shock in several European economies.
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The Political Economy of the EU Approach to the Rohingya Crisis in Myanmar
We provide a political-economy explanation for the EU’s 2018 stance prioritizing dialogue over trade preference withdrawal, highlighting pressures from EU firms to avoid GVC disruptions vis-à-vis Myanmar.
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Estimating market power for the European manufacturing industry between 2000 and 2014
Using sectoral input–output tables and an entropy-based method, we document heterogeneous evolution of market power across 28 countries and 14 manufacturing sectors; globalization and value-chain positioning reduce markups.
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Labor Share, Industry Concentration and Energy Prices
Using data from 15 EU countries and 56 sectors (2000–2016), higher energy prices reduce the labor share; we find no robust evidence that energy prices affect industry concentration or markups in the short run.
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The diffusion of technological progress in ICT
Since the mid-2000s there have been positive, persistent technology spillovers to sectors intensively using ICT; neglecting leasing activity overestimates TFP responses in most sectors.
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Startup Types and Macroeconomic Performance in Europe
Using 1.3M startups in ten countries, we identify five startup types… Policies that shift composition toward high-performance types can yield sizable gains in employment and productivity.
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Covid-19 pandemic, state aid and firm productivity
Across five EU countries, the pandemic led to a short-term productivity decline driven mainly by within-firm dynamics; subsidies were distributed relatively efficiently but had limited aggregate productivity effects.
2021
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Market Power, Productivity and Sectoral Labour Shares in Europe
We show the labour share varies considerably across countries and sectors… globalisation and the rise of “superstar firms” relate negatively to the labour share, more strongly within sectors than between sectors.
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How European Markets Became Free: A Study of Institutional Drift
We model why a single market promotes a supranational regulator enforcing competition beyond individual-country preferences and confirm predictions with evidence on EU institutions’ independence and enforcement strength.
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Regional economic impact of Covid-19: the role of sectoral structure and trade linkages
A region’s economic structure and trade relations, not only infection spread, explain the heterogeneity of labour-market impacts; EU supply-chain integration creates vulnerabilities to disruptions.
2020
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EIB Group Survey on Investment and Investment Finance: A technical note on data quality
The ORBIS sampling frame captures the target population well; benchmarking shows little selection bias and EIBIS portrays cross-country differences and dynamics satisfactorily relative to SBS and CompNet.
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What drives export market shares? It depends! An empirical analysis using Bayesian model averaging
Export market share growth links to different factors across old vs new EU member states; competitive pressure from China is key for both; price competitiveness plays a limited role overall.
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Rising Concentration and Wage Inequality
Using industry data from 14 European countries (1999–2016), we find a positive, statistically significant correlation between market concentration and between-firm wage dispersion.
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Trade, Productivity and (Mis)allocation
Export and import expansion both generate large aggregate productivity gains via firm-level reallocations; institutional quality amplifies gains from import competition and dampens those from export access.
2019
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The fall of the labor share and the rise of superstar firms
We document patterns consistent with the “superstar firm” hypothesis: rising industry concentration, falling aggregate labor share driven by between-firm reallocation, and similar patterns internationally.
- Productivity Report 2019
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Standing up for competition: Market concentration, regulation, and Europe's quest for a new industrial policy
After the failed Alstom–Siemens merger, proposals to weaken EU competition policy surfaced. The paper argues Europe needs more, not less, competition to be competitive globally.
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Revisiting the Global Decline of the (Non-Housing) Labor Share
Correcting for dwellings and self-employment, non-housing corporate labor shares are stable across major economies except the US, where the labor share declines by ~6 p.p. since 1980.
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Firm heterogeneity and trade in EU countries: a cross-country analysis
Exporting firms are larger, more productive, and pay higher wages; trade openness boosts firm productivity and allocative efficiency, with heterogeneous effects by composition and characteristics.
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Labour Reallocation in Recession and Recovery: Evidence for Europe
Productivity-enhancing reallocation is usually counter-cyclical but was weaker during the Great Recession in the EU; it later reverted to more normal patterns.
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Revisiting the global decline of the (non-housing) labor share
Cross-country differences in corporate-sector delineation bias labor shares; harmonized series are stable except in the US, where the decline is driven primarily by manufacturing.
2018
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Cyclical and structural variation in resource allocation: evidence for Europe
Using ECB CompNet data, we show reallocation toward more productive firms varies across countries and time; the silver-lining effect in downturns did not appear during the Great Recession.
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Structural policies in the euro area
Structural policies—labour, product, and financial market regulations plus governance and institutions—can yield substantial gains in income and employment and support social fairness; synergies between growth and inclusiveness are highlighted.
