Business Intelligence

Endogenous Technical Change, Spillovers, And Market Structure

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Executive Summary

This paper investigates the effect of spillovers in a model of endogenous technical change resulting from learning or network effects on the existence of a lower bound to market concentration. Why are some industries dominated by very few firms (even on a global scale) while others have only negligible degrees of market concentration? How is this question related to the size of those markets and how do other industry specifics such as learning and network effect affect market structure? The study of these issues is imperative for all those involved in competition policy analysis as well as for decision making bodies that are concerned with industrial policy in the widest sense.

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