Grant Category

Market Structure

Are markets becoming less competitive and, if so, why, and what are the larger implications?

The premise of a market economy is that broad-based economic gains come from a well-functioning market. Yet there is evidence that growing economic inequality is undermining our society’s ability to act collectively in pursuit of the nation’s welfare. When stakeholders who comprise economic systems subvert institutions for their own gain, the economy loses. If markets are becoming less competitive, the resulting increase in monopoly power could be contributing to these problems.

New data-driven research provides more evidence that markets are increasingly concentrated and that, in many cases, this is indicative of a reduction in competition. Markups, the traditional measure of monopoly power, are growing. Investment and new business start-ups have been falling steadily even as corporate profits are rising. At the same time, labor income as a share of national income is falling. Does the economy suffer from a monopoly problem and, if so, why, and what are the larger implications?

We are interested in research from an aggregate perspective, which has been common in the macroeconomic and labor literatures, as well as sectoral analysis that has been the focus of industrial organization literatures.

  • The causes of increased concentration
  • Consequences of concentration for productivity, investment, and economic growth
  • Consequences of concentration for labor markets and power

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The impact of consumer credit access on employment, earnings, and entrepreneurship

Grant Year: 2016

Grant Amount: $47,700

Grant Type: academic

This project studies access to credit, via bankruptcy flag removal, on several key outcomes of interest, including business formation rates, earnings and profitability. The research could provide a valuable contribution to our understanding of how microeconomic outcomes affect macroeconomic performance via the innovation channel. This connection is an important one that researchers have not been able to make in an empirically rigorous way to date. The basis of this project is the data: the authors will merge individual employment records from the U.S. Census Bureau with individual 1040 Schedule C tax returns and individual TransUnion credit reports. In addition to having clear implications for bankruptcy law, the study suggests important connections between credit access and employment, and also has potential implications for policy responses to the next economic downturn, given that credit access and debt forgiveness may impact macroeconomic growth in ways that are not well understood.

The distribution of economic activity across firms and the decline in the firm start up rate

Grant Year: 2016

Grant Amount: $15,000

Grant Type: doctoral

Over the past several decades, the firm start-up rate has declined substantially while at the same time the number of unique business locations that belong to the largest firms also increased significantly. Using a combination of empirical analysis and modeling, the researcher will explore how these trends affect consumer welfare and productivity growth. We see this as an important contribution to a live question in the innovation space that also has implications for policymakers seeking to increase the firm start-up rate and spur local business activity.

The unequal gains from product innovations

Grant Year: 2016

Grant Amount: $15,000

Grant Type: doctoral

This project explores the relationship between consumption inequality and innovation. It asks whether economic inequality affects the kind of innovation that takes place and who benefits from that innovation. Using scanner data, the researcher’s preliminary findings show that the difference in inflation rates across the income distribution can be accurately measured only with product-level data, not by simply reweighting aggregate price series based on income-specific spending shares, as the U.S. Bureau of Labor Statistics does. The findings could therefore have methodological as well as policy implications.

Minority entrepreneurship and economic disparities: Revisited from a development perspective

Grant Year: 2015

Grant Amount: $78,000 Co-Funded with the Ewing Marion Kauffman Foundation

Grant Type: academic

Innovation and entrepreneurship have long been strengths of the U.S. economy. But the experiences of entrepreneurs vary dramatically. In particular, race, ethnicity, and gender may play a significant role in shaping these experiences. This project will look at the differences among businesses owned by individuals of different racial and ethnic groups, as well as women-owned businesses. The researchers will look at business survival, business size, profits, and innovation activities. They will also seek to understand how these variations interact with and are influenced by the regional characteristics in which the businesses operate. Understanding the underlying factors that influence successful entrepreneurism is key for boosting innovation and future economic growth.

Inside monopsony: A mixed methods approach to understanding how labor standards shape employment practices in the restaurant industry

Grant Year: 2014

Grant Amount: $14,000

Grant Type: academic

This research will look at how regional variations in labor market regulations influence the types of businesses that locate in those regions, and the employment practices of those businesses. The analysis will focus on San Francisco, which has relatively comprehensive locally enforced labor standards, and the North Carolina Research Triangle, which lacks strong labor standards. This research project seeks to understand how locally-enacted labor standards that aim to reduce inequality reshape the structure of work in low-wage industries, with a specific focus on the restaurant industry.

Schedule stability for hourly workers – Phase I of II

Grant Year: 2014

Grant Amount: $40,000

Grant Type: academic

This research will investigate the interaction of business time-scheduling policies and changing family structures. Unpredictable work hours, more common among low-wage workers, may reduce worker productivity and thus economic growth. In conjunction with at least one corporate partner, the researchers will test the impact of effective scheduling systems on employees via a controlled intervention. They will divide workers into groups, with certain groups receiving greater control over their schedules, and then examine the resulting absenteeism and attrition rates for each group. The research will test the hypothesis that an improved work-life fit will lead to greater job satisfaction for hourly workers, who will in turn be less likely to leave their jobs when family obligations interfere with their schedule, and ultimately will result in enhanced economic security for these workers. At the same time, the research will explore whether employers who implement scheduling practices that improve work-life fit are able to retain experienced employees who are more productive than newly-hired employees.

Experts

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Luke Elliott-Negri

Graduate Center of the City University of New York

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Hana Shepherd

Rutgers University

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Emi Nakamura

University of California, Berkeley

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Jennifer Laird

City University of New York (CUNY)

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Glen Kwende

American University

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