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Vous avez t dconnect car votre compte est utilis partir d'un autre appareil. For entry & exit and market-share stability it showed relatively strong arrears, indicating weak dynamics. For each of the three countries, four of the five measures were available. It has been introduced by Boone (2000) and is measured by the marginal-cost elasticity of a producers profit, often acronymed as the profit elasticity. It may be defined as the interaction between market players, where each tries to be the most efficient in order to maximise his profit, and by doing so leads to the most efficient outcome for the economy. Tous droits rservs pour tous pays.

This should indicate higher market concentration. Instead of marginal cost, however, average cost is mostly applied as a proxy, since it can easily be derived from company or industry data. The numbers in the table show the difference in index points between Belgium and the benchmark samples, at both the beginning and the end of the time series. 18Another caveat concerning relevant markets is that most data sources are classified according to industries, which is not the same as markets.

Recall, however, that this might also be induced by the increasing sample used for calculating the measure, which rose from 87,000 company accounts in 1997 to 113,000 in 2006. Price-cost Margin Herfindahl-Hirschman Index (0-1000) Sensitivityof profit to cost changes Market economy Whole EU sample Ger & Neth only Whole EU sample Ger, Fra & Neth only Whole EU sample France only Beginning of time series + 0.04 + 0.06 + 75 + 82 - 0.08 + 0.12 End of time series + 0.18 + 0.23 + 68 + 57 + 0.06 + 0.11 Evolution of Belgium w.r.t. Unfortunately, the measures were not available for years more recent than 2006. There is, however, no guarantee this will happen in the real world. The reader less interested in that detail may mind the occurrence of measurement problems and skip the section. The outcomes should therefore be treated as proxies of what the indicators should really measure. Although the same problems of continuity should hold, the course of the time series is relatively smooth. Source: Authors elaboration on INTAN-Invest and TiVA (OECD) data. Compared to the neighbouring countries, the patterns of convergence have been more obvious. They also show whether the intensity of competition has evolved for the better or the worse, and whether there has been convergence or divergence with other Member States. Global Competitiveness Report Special Edition 2020: How Countries are Performing on the Road to Recovery, The Global Competitiveness Report 20172018, Schwab Foundation for Social Entrepreneurship, Centre for the Fourth Industrial Revolution. In nine years time, both margins had risen, the Belgian to 1.37, the others to 1.16. There is a general consensus that integration into GVCs brings benefits beyond those traditionally associated with international trade in final goods, allowing countries to specialise in single tasks and benefit from economies of scale and scope. (2006ab) and Boone et al. The same notes and definitions as given in Tables A1 and A2 hold. China, India, Brazil and Mexico are moving to develop their own brands and marketing expertise in advanced economies to increase their control over the downstream end of the value chain.21, These observations lead us to reflect on the relationship between investment in intangible assets and participation in and gains from global value chains. Hence, industry data are mostly too aggregated for the analysis of competition in a market. The most comprehensive data source is that of company accounts. These studies find that higher levels of development, infrastructure and human capital lead to increased participation in GVCs, while strict regulations, tariffs and other trade impediments are detrimental.17. (2010), which used AMADEUS for the calculation. For many industries there are discrepancies between the total turnover of the sample and the official production value of the industry as given in the EUKLEMS database. Source: Authors calculation based on INTAN-Invest data. 4 ) Because of the different sizes of country samples, the rank of Belgium within the samples has been normalised. According to the common interpretation, Belgium would be among the countries that have a relatively weak allocative efficiency. A final measure is import penetration. 8, No. For most industries Belgium ranks between 19th and 22nd out of 23 countries. Figure 4 shows data on total intangible capital against participation in GVCs in the whole economy, all expressed in per hour worked across the sample countries.24 Correlation is significantly positive, suggesting a deeper analysis is warranted. It may not only reflect economic rent, but all kinds of data biases and errors too. This held when both the whole sample and the neighbouring countries were used as a benchmark. Besides the deterioration of terms of trade, this evolution is explained by an increase in volume of export that is weaker than the increase in volume of import. This is a little higher than the average of the whole sample, although a little below that of the neighbouring countries (1.5%-point). The strongest instability concerns 2002. Wage premiums have already been mentioned as the share of the economic rent that is captured by workers. The next section applies the Herfindahl-Hirschman Index (HHI). Le rsultat montre que la Belgique performe moins bien (selon trois mthodes) ou, au mieux, aussi bien (selon deux mthodes) que la moyenne des pays membres de lUnion europenne, mais certainement jamais mieux. This could thus involve the same implications as the HHI has, making the measure a proxy of the true market stability. Besides the averages of the whole samples, Table 2 gives the measures for the three neighbouring countries and their weighted average, serving as another relevant benchmark for competitiveness. Therefore, more sophisticated analyses may help shed light on the possible mediating role of intangible assets in affecting the relationship between GVC participation and productivity growth. Supermarket chains compete with each other on the national market, but compete the grocery stores on their local markets. In Table A3, note the differences in industry classification between the measures. For international benchmarking a database is available at Eurostat. Second, imported goods are of course not covered by domestic manufacturing industries. Note that the ADSEI/DBRIS data show an average entry and exit rate (non-market services included) falling from 8.9 to 7.2% between 1998 and 2002, and then rising to 8.7% in 2007. Entry from abroad is only registered in the entered industry when it concerns FDI. using the newly constructed INTAN-Invest cross-country, cross-industry dataset for 18 European countries and the US, which is used to analyse the impact of tangible and intangible capital before and after the Great Recession in 2008-2009.14 They found that tangible investment fell dramatically during the Great Recession and has barely recovered, whereas intangible investment has been comparatively resilient; it recovered quite quickly in the US, though it lagged behind in the EU. There are companies that do not need to publish their accounts at all. An elasticity close to zero would indicate a weak rivalry. The Annex Table A1 gives the precise time series, which are different per measure. It explored five measures for the intensity of competition, each focusing on a specific aspect. The profit elasticity of the only neighbouring country in the sample, France, stayed below that of Belgium, but evolved at more or less the same pace. To the best of our knowledge, there are few empirical analyses which aim at disentangling the underlying determinants. This is already illustrated by the relatively low scores of Germany and France. She noted, however, that such a correction assumes homogeneity among producers. Valentina Meliciani, This article is part of Solving the European Productivity Puzzle. 1 ) See Annex Tables A1 for the definition of the time series and the samples of countries and industries and A2 for the outcomes by industry. The markup is the balance of price and marginal cost, both of which are affected by competition. Few countries have mechanisms for preventing competitiveness deterioration. the foreign value added content of a countrys exports, finding that industry-level investment in organisational capital is causally linked to GVCs in the form of backward linkages with the foreign market.22 Jona-Lasinio et al. This data source, however, gives rise to some further implications. (2010), Eurostat and EUKLEMS. Overall, there is evidence that a great part of the value added of a final product is created in the first and last stages of the production process (R&D, design, marketing and sales), while firms involved in intermediate stages (such as the production of components and assembly) reap only a small part of the final value of the good or service produced.5. Parmi les dterminants de la PTF, les conditions de concurrence peuvent avoir jou un rle important et sont un lment intressant pour la politique conomique dans la mesure o lamlioration de ces conditions nest pas budgtairement coteuse. For four out of five measures it performed significantly worse than the average of other countries. (2010) Time (series) 1996-2005* 2006 1997-2006 1998-2005**** 1997-2005 Countries 9 of EU-15 23** of EU-27 21 of EU-25 13 of EU-15 7 of EU-15 Industries 17 19 17 19 19 Manufacturing - weight (avg. In services, market concentration and the profit elasticity were lower than in manufacturing. Price-cost margin Entry & exit Market concentration Market stability Profit elasticity Source Braila et al. In this paper, after briefly reviewing these two fields of analysis, we suggest some lines along which they can be fruitfully linked in order to establish the basic framework with which to investigate the synergies between intangible capital and participation in global value chains (GVCs) as drivers of productivity growth in modern economies. According to the common interpretation of the price-cost margin, this would imply a decreasing intensity of competition, in particular in services industries. By Small countries typically have higher HHIs than large ones and are better represented in the applied data source. The Netherlands did so for three and France for two measures. TFP = total factor productivity, LQ = labour quality, ICD = intangible capital deepening, TCD = tangible capital deepening. As a consequence, the contribution of tangible investment was relatively small in some of the sample economies in comparison to the impact of intangible capital, which provided a larger contribution to productivity growth over the period (especially in the United Kingdom, Finland and the Netherlands). This is an interesting starting point for future studies that can provide more sophisticated empirical analyses on the possible direct and indirect (i.e.

Two grocery stores located in different towns may not be in the same relevant market. A database of company accounts can of course be filtered for such extreme cases. The market mechanism may be at work without entry occurring. This is not unambiguous, and data sources are not tuned to such definitions. The price-cost margins, however, diverged for the worse, although some ambiguity in the interpretation of the measure cannot be ruled out. 2 ) Average of 1998-2001 and 2003-2005, since the data for 2002 seem too erratic. The evolution, or cross-border comparison, of price levels should indicate market efficiency, be it allocative, productive or dynamic. This implies that competition makes market players strive to be the most cost-efficient. This difference, however, also holds in other countries. This may impede international comparability of the measures. Nicoletti & Scarpetta, 2003; Conway & Nicoletti, 2006) as an indicator of competition. The heterogeneous behaviour of US and European countries in terms of intangible capital accumulation (with Europe and in particular some Mediterranean countries still lagging behind) suggests that greater efforts are required at the European level to encourage public and private investment in intangibles in order to foster economic growth and international competitiveness. 14The last measure to be applied also tries to capture the extent of rivalry among market players. This could be done for three measures: price-cost margin, market concentration and profit elasticity. Besides the selection effect, market concentration thus involves a reallocation effect. They do so either by making an optimal use of given technology or by investing in new technology. 20A further implication of the use of accounting data is that not all companies need to publish complete data. Although, as stated in the Introduction, market regulation can be interpreted as a determinant of competition, it is avocated by the OECD (e.g. The empirical results revealed that intangible capital has been the largest systematic driver of US business sector growth over the last 50 years,2 and that US businesses currently invest more in intangibles than they do in traditional fixed assets.3, At the same time, the digitalisation process and the drop in transmission costs favoured the globalisation of value chains. [6] For all three, the intensity of competition in the other European countries evolved in the same direction. Among further determinants underlined by the economic literature, competition conditions are particularly interesting as improving these conditions is generally not budgetary hurting and could be linked to the administrative simplification process. Another example is post & telecommunications. The impact of competition on prices is indeed driven by allocative efficiency.

You might also want to visit our Cairn International Edition. accelerates resurgence lining pandemic province industry forest silver For the other two, Belgium perfoms around the average of other European countries. There may be country- or industry-specific circumstances unrelated to competition.

How Can Europe Upgrade Its Convergence Machine? 2The results show a cumulative deterioration, over the period 1996-2007, of Belgian market economy[1] competitiveness by 6.1% compared with the weighted average of the three neighbouring countries. The focus is fully on the reallocation effect of competition. Belgium is one of these: it adopted in 1996 a law limiting hourly wage increases in private sector to the growth in its three neighbouring countries. Concerning the small grocery stores, there is an analogy with other service activities operating locally, such as insurance agencies or hairdressers. The theoretical and measurement problems make the indicators serve as a sensible proxy rather than a precise measure. A downward data bias could, however, not be ruled out here. The literature on intangible capital and productivity growth (mostly at the macro and sectoral level) and on the organisation of global value chains (mostly at the micro level) have remained two separate fields of investigation. Market concentration has fallen. & opt. He analysed the same measures, in some cases from more detailed data sources, and managed to relate the weak performance to the strong market regulaton of that industry in Belgium. These accounts only report primary cost such as wages and depreciation, but no purchases of goods and services. Data to examine a pattern of convergence or divergence was lacking. For example, the market-share stability of the Belgian software industry fell the most behind the other countries average of all Belgian industries, showing relatively weak dynamics in the industry. Imperfect competition would give rise to the persistence of economic rent. Griffith et al. For all five measures the United Kingdom, Sweden, Finland and Italy are in the sample. 8Maybe the most frequently applied measure is the price-cost margin, showing the markup of revenue above marginal cost. On the other hand, it was one of the Belgian industries with the highest lead in profit elasticity, which would, on the contrary, indicate a strong rivalry. For entry & exit, as already noted, no time series was available for other Member States. ULC deterioration is observed and quasi equal in manufacturing (8.2%) and in market services (8.1%). bentley autopipe connect edition cad webforpc dwg compatible software wide cadalyst features The measure is taken from a study by Braila et al. Figure 2 shows a subset of results of the growth accounting analysis developed in a recent paper by Corrado et al. 28For manufacturing and services separately, the outcomes were not different to those for the whole market economy. Market economy Price-cost margin Average of entry and exit rates Herfindahl- Hirschman Index (0-1000) Average absolute change of market shares 2 Sensitivity of profit to cost changes 3 Belgium 1.14 6.0% 267 1.3%-pt 1.26 Other European countries 1.08 9.2% 199 1.2%-pt 1.27 Neighbouring countries: 9.1% 204 1.5%-pt: of which: Germany 1.02 9.5% 197 2.0%-pt: France: 8.6% 185 0.8%-pt 1.15 Netherlands 1.10 8.7% 300 1.9%-pt: Normalised rank of Belgium (scale 0-10) 4 3.8 0.5 2.5 5.0 6.7 Manufacturing Belgium 1.15 4.1% 302 1.2%-pt 1.82 Other European countries 1.06 6.7% 206 1.0%-pt 1.78 Neighbouring countries: 6.1% 215 1.2%-pt: of which: Germany 1.03 5.8% 203 1.6%-pt: France: 6.4% 193 0.5%-pt 1.61 Netherlands 1.20 6.0% 350 1.6%-pt: Normalised rank of Belgium (scale 0-10) 4 5.0 0.5 1.5 5.8 6.7 Market services Belgium 1.14 6.3% 206 1.4%-pt 1.07 Other European countries 1.09 9.4% 186 1.3%-pt 1.10 Neighbouring countries: 9.4% 182 1.6%-pt: of which: Germany 1.01 10.1% 187 2.2%-pt: France: 8.5% 169 0.8%-pt 1.02 Netherlands 1.08 9.3% 204 1.9%-pt: Normalised rank of Belgium (scale 0-10) 4 3.8 0.5 3.0 5.0 6.7 Sources: Braila et al.

The user cost of capital is calculated as. other European countries Divergence Convergence Constant Weak convergence Overtaken Weak divergence Market services Beginning of time series + 0.02 + 0.02 + 28 + 48 - 0.07 + 0.08 End of time series + 0.20 + 0.29 + 10 + 10 + 0.04 + 0.03 Evolution of Belgium w.r.t. It may be working under the threat of entry and/or when there is a strong rivalry among incumbent firms. 30From the measures of market concentration (services only) and profit elasticity, one could prudently conclude that the intensity of competition has evolved more favourably in Belgium than in other Member States. 3 ) The UK is excluded from the other European countries because of its too different outcomes. There are further complications arising from industry data. (2007) pretend that this measure gives more plausible results than the price-cost margin or market concentration does. Although it holds no mathematics, the section may arrive as a bit technical. The authors follow the belief that there is a one-to-one relationship between regulation and prices, and other measures hold a certain level of endogeneity.

Mme si larticle ntablit pas statistiquement de relation entre concurrence et PTF, les rsultats suggrent que la faible performance en termes de PTF pourrait tre due des conditions de concurrence dfavorables.Codes JEL: D24, L11. Belgium ranks among the lower half, but not too deeply (score of 3.8 on a scale of 10). The average HHI is higher than that of other countries, 267 versus 199 (neighbours: 204) on a scale of 1,000. Moreover, for most countries the entry and exit rates are systematically high, moderate or low: when a country shows high (low) entry and exit rates, it is the case in most of its industries. Given the complex nature of competition, however, one should be aware of the caveats and pitfalls of the measures. Intereconomics/ The smaller the country, the better its companies seem to be represented in the data. There are several channels through which participation in GVCs and productivity can be linked. This was already illustrated by the retail example, where the two small groceries are in the same industry but not in the same market. The measure is available from a database linked to EUKLEMS, where it has been calculated from AMADEUS. The numbers in the table show the change in index points between the beginning and the end of the time series. Intereconomics is published by ZBW Leibniz Information Centre for Economics and CEPS Centre for European Policy Studies. Despite low entry and high concentration there could very well be a strong rivalry among the incumbent firms. & opt. Like market stability the measure is taken from Braila et al. France and Spain are not in the sample of the price-cost margin. For certain differences between countries the same may hold. Among them may even be large ones that are exempted because of their legal form. This latter database, however, only gives complete data for 2006. They nevertheless allow to analyse the tendency by which competition generally evolves on the markets that comprise the industry. They do show how the intensity of competition in Belgium compares to other EU Member States, in particular the neighbouring countries.