General Equilibrium Oligopoly and Ownership Structure

• 成果类型: Article
• 署名作者: Azar, Jose; Vives, Xavier
• 署名单位: University of Navarra; University of Navarra; IESE Business School
• 刊物名称: ECONOMETRICA
• ISSN/ISSBN: 0012-9682
• DOI: 10.3982/ECTA17906
• 发表日期: 2021
• 页码: 999-1048
• 关键词: COMMON OWNERSHIP; monopolistic competition; corporate governance; MARKET-POWER; INDEX FUNDS; externalities; monopsony; cournot; origins; share

摘要

We develop a tractable general equilibrium framework in which firms are large and have market power with respect to both products and labor, and in which a firm's decisions are affected by its ownership structure. We characterize the Cournot-Walras equilibrium of an economy where each firm maximizes a share-weighted average of shareholder utilities-rendering the equilibrium independent of price normalization. In a one-sector economy, if returns to scale are non-increasing, then an increase in effective market concentration (which accounts for common ownership) leads to declines in employment, real wages, and the labor share. Yet when there are multiple sectors, due to an intersectoral pecuniary externality, an increase in common ownership could stimulate the economy when the elasticity of labor supply is high relative to the elasticity of substitution in product markets. We characterize for which ownership structures the monopolistically competitive limit or an oligopolistic one is attained as the number of sectors in the economy increases. When firms have heterogeneous constant returns to scale technologies, we find that an increase in common ownership leads to markets that are more concentrated.