Working Papers

Knowledge is (Market) Power (Job  Market Paper)

Abstract: US corporate concentration has been persistently rising over the past century with flattening Pareto tails, and productivity growth has been concurrently declining. This paper builds a continuous-time Schumpeterian growth model that interprets higher concentration as a result of lower growth, which complements the existing Schumpeterian literature that focuses on the opposite direction. In the model, laggards benefit from dynamic growth advantage, while leaders possess the static advantage inherent to their leading position. A uniform decline in research productivity hurts endogenous growth of all firms but in particular that of laggards, increasing the relative growth of leaders and fattening the Pareto tail of productivity distribution. With a demand system featuring variable demand elasticities, the proposed mechanism stemming from declining research productivity explains a majority of the changes in productivity growth, corporate concentration, markup, labor share, R&D cost, entry and exit rates, and job creation and destruction rates in the US since 1980s. The model can accommodate increasing concentration with stable markup and labor share in the pre-1980 period by introducing economic integration in addition to declining research productivity.

Econ Job Market Best Paper Award (UniCredit Foundation and the European Economic Association)

Presentations: Sciences Po, Collège de France/INSEAD, LBS, TADC 2023, EEA-ESEM Congress 2023, LUISS Workshop of Mean Field Games in Economics, Econometric Society European Winter Meeting

China in Europe, with Pauline Lesterquy and Hélène Rey

Abstract: Following its accession into the World Trade Organization in 2001, China has become an international trading power. Chinese investments overseas have also sizeably increased and the arrival of the Belt and Road Initiative on European shores has made headlines news. This paper explores whether the People's Bank of China' s monetary policy spillovers are reaching European companies. Our preliminary results using the ORBIS dataset for a selection of European countries show that investment decreases by 3% after a one standard deviation shock of Chinese monetary policy. We plan to characterize the sectors in which the transmission is the strongest and to identify the transmission channels. French firm-level custom and ownership data have been requested to establish whether trade linkages or financing effects through Chinese banks are the most relevant ones.

Work in Progress

The Granular Effects of Carbon Pricing, with Diego Känzig and Hélène Rey