Globalization, Technological Change and Market Power in Latin America: Evidence for Chile and Colombia

Jessica Bracco, Irene Brambilla, Manuela Cerimelo, Andrés César and Guillermo Falcone

No 14099, IDB Publications (Working Papers) from Inter-American Development Bank

Abstract: This paper studies concentration and market power in Chile and Colombia and the role that globalization and automation have had in shaping these two phenomena. Using panels of firm surveys, we compute firm-level markups and industry-level concentration measures. Applying a difference in differences methodology that relies on variation across industries in exposure to robotization technology, import competition from China and tariff declines in US markets due to the signature of free trade agreements, we study the causal effects of these shocks on market power and concentration. We find that, while robotization technology has reduced markups on average, it has increased markups and total factor productivity of top industry firms; that the pro-competitive effect of Chinese imports has indeed led to a decrease in market power of domestic firms; and that increased export opportunities due to free trade agreements have led to an increase in market power, with interesting heterogeneities across the two countries.

Keywords: Mark-ups; Market concentration; trade agreements; Robotization (search for similar items in EconPapers)
JEL-codes: F14 F61 L11 O33 (search for similar items in EconPapers)
Date: 2025-05
New Economics Papers: this item is included in nep-com, nep-ind, nep-lam and nep-tid
References: Add references at CitEc
Citations:

Downloads: (external link)
https://publications.iadb.org/publications/english ... ile-and-Colombia.pdf (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:idb:brikps:14099

DOI: 10.18235/0013531

Access Statistics for this paper

More papers in IDB Publications (Working Papers) from Inter-American Development Bank Contact information at EDIRC.
Bibliographic data for series maintained by Felipe Herrera Library ().