Do Large Firms Generate Positive Productivity Spillovers?

Mary Amiti, Cédric Duprez, Jozef Konings and John van Reenen

No 20231012, Liberty Street Economics from Federal Reserve Bank of New York

Abstract: Numerous studies have documented the rising dominance of large firms over the last few decades in many industrialized countries. Many research papers have focused on the potential negative effects of this increased market concentration, raising concerns about market power in both labor and product markets. In a new study, we investigate whether large firms also generate positive effects. Our research shows that large firms generate significant positive total factor productivity (TFP) spillovers to their domestic suppliers. To date, these types of spillovers have only been identified for multinational enterprises located in developing countries. Using firm-to-firm transaction data for an industrialized country, Belgium, we find that large domestic firms, as well as multinationals, generate positive TFP spillovers.

Keywords: large firms; productivity; spillovers (search for similar items in EconPapers)
JEL-codes: E2 (search for similar items in EconPapers)
Date: 2023-10-12
New Economics Papers: this item is included in nep-bec, nep-com and nep-eff
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Working Paper: Do large firms generate positive productivity spillovers? (2024)
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