SUPERNET: Firm Heterogeneity, Superstar Firms and Production Networks

This research agenda studies the existence and evolution of superstar firms in global and local value chains and production networks.

Recent decades have reinforced the widespread existence of superstar firms. These “granular” firms are so large that they dominate whole industries and account for a significant fraction of aggregate output. Such firms can contribute to misallocation of resources, abuse of dominant position and stifle entry and innovation. Moreover, these firms are not isolated units of production: they are connected through complex production networks of suppliers and customers. Their impact is then often not confined to their respective industries, but can affect output and growth in several sectors and in the aggregate. 

This raises several important social questions: what is the size and impact of misallocation and market power on welfare and the division of surplus? How should we regulate or stimulate such firms? How to intervene when these systemic firms collapse?

This program will develop quantitative frameworks for the analysis of firm size, market power and competition policy in production networks on the intersection of theory, econometrics and machine learning.

Coordination: Glenn Magerman, ECARES, Solvay Brussels School Economics & Management


Created on September 4, 2020