The convergence of price-cost margins

Hervé Boulhol ()
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Hervé Boulhol: TEAM - Théories et Applications en Microéconomie et Macroéconomie - UP1 - Université Paris 1 Panthéon-Sorbonne - CNRS - Centre National de la Recherche Scientifique, IXIS-CIB - Corporate Investment Bank

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Abstract: This paper gives estimates of sectoral markup trends in thirteen OECD countries over the last three decades. It concludes with a slight, albeit heterogeneous, increase in price-cost margins (PCMs) overall, contrary to the generally expected effect of increased competition. More strikingly, it estabishes a clear pattern of PCM convergence both across countries and sectors. This convergence means that high margins have shrunk and low margins grown. These movements seem to be linked to the decline in the labour share. They point to a need to search for factors counterbalancing the pro-competitive effect on markups.

Keywords: markup; price-cost margin; pro-competitive effect; wage bargaining; labour share; marge prix-coût; effet pro-concurrentiel; négociations salariales; part des salaires (search for similar items in EconPapers)
Date: 2005-09
Note: View the original document on HAL open archive server: https://shs.hal.science/halshs-00195890
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Citations: View citations in EconPapers (2)

Published in 2005

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Persistent link: https://EconPapers.repec.org/RePEc:hal:journl:halshs-00195890

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