There has been a long-term increase in income inequality across households in the U.S. Delving into the wages paid to workers with administrative data it appears that the vast majority of increasing wage inequality is due to differences between firms. High wage workers are increasingly employed together.
There is substantial evidence of marked cross-sectional heterogeneity in the sizes and the productivities of firms. In recent years, it also seems that the gap between firms at the top at the bottom of the performance distribution has increased, whether measured by size or productivity. Large firms – sometimes called “mega-firms” – have begun to dominate many industries. Various measures of concentration, such as the share of sales of the largest firms, have increased in many sectors of the U.S. economy. The fall in the share of national income going to labor has coincided with the increase in the prevalence of mega-firms. In the last decade there has also been a decline in productivity growth.
To explore the causes and consequences of the rise of large firms on the economy, with particular emphasis on labor market effects, the National Bureau of Economic Research (NBER), with the support of the Smith Richardson Foundation, will convene a research conference in Cambridge, MA, on Friday, October 19, 2018. The conference will be organized by Kathryn Shaw (Stanford Graduate School of Business and NBER) and John Van Reenen (MIT and NBER).
The NBER invites the submission of research papers the bear on the links between firm size, the concentration of product markets, and labor market outcomes. Potential topics for discussion at the meeting include, but are not limited to:
* What are the causes of these increasing differences between firms? For example, what are the roles of technology, globalization, changing consumer demand, regulations or other factors?
* How robust are the findings of increasing differences between firms to concerns over sources and quality of data?
* Do large firms adopt different technologies than smaller firms, and does this affect the demand for labor or the nature of production?
* What are the broader implications of the rise of mega-firms for aggregate economic outcomes such as the labor income share, productivity growth, employment levels, and consumer welfare?
These and other questions can be approached using data from many different sources, including administrative records, Census data, and firm-level information. The conference will encourage the use of various data sources, as well as perspectives from various subfields within economics, and other disciplines, that may inform the key issues. It will also support dialogue on what questions remain unanswered, and on what data might be brought to bear to address unresolved issues.
Researchers are encouraged to submit their papers at the following website:
no later than midnight EDT on Wednesday May 9 2018. Proposals from researchers with and without NBER affiliations are welcome, as are proposals from early career scholars and from researchers who are members of groups that are historically under-represented in economics and finance. Decisions about which proposals are accepted will be announced in early June.
NBER will cover the hotel and travel cost for two authors per paper. Other participants may also attend the meeting if space permits. Anyone interested in attending the meeting, but who does not have a paper to submit, may email Carl Beck in the NBER Conference Department firstname.lastname@example.org.Questions about the conference should also be directed to him.