Mark-Up Ratios in Manufacturing Industries: Estimates for 14 OECD Countries

This paper provides estimates of mark-ups of product prices over marginal costs for 36 manufacturing industries in 14 OECD countries over the 1970- 1992 period. The estimates are based on the methodology put forward by Roeger (1995), extended to include intermediate inputs. After a discussion of analytical and data issues, the estimates are presented and shown to be smaller than those of previous studies. It is also shown that the level and dispersion of mark-ups are consistent with a priori views about characteristics of the market structure prevailing in each industry. Finally, the paper examines how mark-up estimates affect the estimated rate of growth of total factor productivity (TFP) ... Cette etude fournit des estimations sur le taux de marge des prix sur les couts marginaux pour 36 industries manufacturieres et 14 pays de l’OCDE pour la periode 1970-1992. Les estimations utilisent l’approche mise au point par Roeger (1995) amelioree pour tenir compte des biens intermediaires. L’etude commence par une discussion des problemes methodologiques et statistiques, et les estimations sont presentees. Dans l’ensemble, les taux de marge presentes ici sont beaucoup plus bas que ceux calcules dans d’autres etudes. Le niveau et la dispersion des taux de marge sont relativement coherents avec l’idee a priori sur les caracteristiques des differentes structures de marche. En dernier lieu, il est examine comment les estimations du taux de marge affectent la mesure de la productivite totale des facteurs (PTF) ...

[1]  D. Leahy,et al.  Public Policy Towards R&D in Oligopolistic Industries , 1995 .

[2]  R. Hall.  Market Structure and Macroeconomic Fluctuations , 1987 .

[3]  A. Dixit,et al.  Monopolistic competition and optimum product diversity , 1977 .

[4]  R. Hall,et al.  Invariance Properties of Solow&Apos;S Productivity Residual , 1989 .

[5]  M. Bils.  The Cyclical Behavior of Marginal Cost and Price , 1987 .

[6]  Ricardo J. Caballero,et al.  The Role of External Economies in U.S. Manufacturing , 1989 .

[7]  Robert E. Hall,et al.  The Relation between Price and Marginal Cost in U.S. Industry , 1988, Journal of Political Economy.

[8]  W. Roeger.  Can Imperfect Competition Explain the Difference between Primal and Dual Productivity Measures? Estimates for U.S. Manufacturing , 1995, Journal of Political Economy.

[9]  John Sutton.  The Size Distribution of Businesses, Part I: A Benchmark Case , 1995 .

[10]  Richard Schmalensee,et al.  Inter-industry studies of structure and performance , 1987 .

[11]  Malcolm L. Edey,et al.  An Assessment of Financial Reform in OECD Countries , 1995 .

[12]  Ricardo J. Caballero,et al.  Internal versus external economies in European industry , 1990 .

[13]  A. Orr,et al.  The determinants of real long-term interest rates , 1995 .

[14]  Stefan C. Norrbin,et al.  The Relation between Price and Marginal Cost in U.S. Industry: A Contradiction , 1993, Journal of Political Economy.

[15]  J. O. Martins,et al.  MARKET STRUCTURE , TRADE AND INDUSTRY WAGES , 1994 .

[16]  R. Solow.  TECHNICAL CHANGE AND THE AGGREGATE PRODUCTION FUNCTION , 1957 .

[17]  Susanto Basu,et al.  Intermediate Goods and Business Cycles: Implications for Productivity and Welfare , 1994 .

[18]  John C. Panzar,et al.  Technological determinants of firm and industry structure , 1989 .

[19]  Martin Eichenbaum,et al.  Capital Utilization and Returns to Scale , 1995, NBER Macroeconomics Annual.

[20]  Deborah Roseveare,et al.  Fiscal Policy, Government Debt and Economic Performance , 1994 .

[21]  Deborah Roseveare,et al.  Ageing Populations, Pension Systems and Government Budgets: How Do They Affect Saving? , 1995 .

[22]  J. V. Reenen,et al.  Market Imperfections and Employment , 1995 .

[23]  Timothy F. Bresnahan,et al.  Empirical studies of industries with market power , 1989 .

[24]  M. Kalecki.  The Supply Curve of an Industry under Imperfect Competition , 1940 .

[25]  Claude Giorno,et al.  Technical Progress, Factor Productivity and Macroeconomic Performance in the Medium Term , 1995 .