Our second key finding relates to the impact of broadband internet on firm market power on labor markets. We show that the arrival of
broadband internet reduces firm-level markdowns. 5 years after connectivity, markdowns decline by slightly more than 3 percentage points

Our first key finding relates to the impact of broadband internet on firm market power on output markets. We find that the arrival of broadband internet allows firms to increase markups. 5 years after connectivity, markups rise by nearly 2 percentage points

It's job market season! In my job market paper I'm investigating (with Elie Vidal-Naquet) how access to fast internet has changed market power for firms on both output and labor markets. I'll post a thread soon

We keep going in this Labour Session with a presentation by Gabriele Macci titled:

'Firm Wage Inequality: Capital-Skill Complementarity and Sorting'

Stephen P. Jenkins (@stephenpjenkin1.bsky.social) and Jan-Luca Hennig will discuss the paper thereafter!

👉 Join us here: univ-amu-fr.zoom.us/wc/8147522993

Meet Jan Luca Hennig #EconJobMarket candidate AMSE. He works on Labor Market and Macroeconomics.

Learn more about him➡️amse.site/Hennig

#EconTwitter Jan-Luca Hennig

Fancy a weekend read on gender wage gaps in Europe? Check out the wonderful summary by Dialogues Economiques of my work with Balazs Stadler. I also tried to give an interview in French: youtu.be/TmgkjHLZFts?si…

Thanks again to the whole team of Dialogues Economiques!!

Check out my interview with Dialogues Economiques about my work on the role of firms for gender wage gaps in Europe. The interview is in French (I tried at least), but English subtitles are available ;) Credits to the whole team of Dialogues Economiques for putting this together!

JMP Alert I'm on the Econ Job Market and excited to share my JMP (joint with Elie Vidal-Naquet) with you

We ask how the arrival of broadband internet has affected firm market power distinguishing between product and labor market power

#EconTwitter #EconJMP #EconJobMarket

For a class on European Economic Integration, I am searching for applied papers showing benefits (and disadvantages) of economic integration in Europe, e.g. Euro adoption, trade, etc. I found a few, but would be happy to get a better overview. #econtwitter

Jan-Luca Hennig aeaweb.org/articles?id=10…

First step, we compute markups and markdowns at the firm level based on French balance sheet data. We exploit recent advances of the 'proxy variable approach' (Yeh et al., 2022) to estimate markups and markdowns. Markups = price over marginal cost, markdowns = MRPL over wages

ii) but rising markups have multiple cost factors --> aggregate output tax and misallocation (Edmond et al., 2023; Aghion et al., 2022), distributional
consequences (Boar and Midrigan, 2019; Auray et al., 2022); direction of technological change (Acemoglu, 2023)

This is likely driven by either cheaper imports, better export activity, better (online) advertising, or (domestic) outsourcing. We find that firms tend to
exploit the channels relating to globalization.

Contribution to lit on sources of firm market power: First, we examine publicly funded tech progress as driver of market power (usually firm-level investments); second, we distinguish firm market power on output and labor markets on the firm level, (mainly considered separately)

Second step, we estimate impact of broadband expansion on markups and markdowns by exploiting staggered roll-out of broadband internet in the early 2000s (Malgouyres et al., 2021) with the difference-in-differences estimator by Callaway and Sant’Anna (2021) --> causal inference

The arrival of (fast) internet has a profound impact everyone in the economy, i.e. firms, consumers and workers. The impact of broadband internet
on markups and markdowns is ambiguous because everyone experiences a reduction in information frictions as well as lower search costs

In future work, we explore 1) the consequences of firm market power wrt wage inequality within firms, between firms and sorting, and
2) the role of firms for the gender pay gap, i.e. whether women, in particular around birth, start working in low-markup or high-markdowns firms

We discuss welfare implications (model and simulation to come) --> the impact of broadband internet is ambiguous: i) Declining markdowns unambiguously positive (Berger et al., 2022), as well as increase in product variety through internet (Brynjolfsson et al., 2003), BUT

The key mechanisms relate to worker representation through work councils and unions, and workers changing employment. Surprisingly, low-skill workers seem to profit more from job changes after the introduction of broadband internet than high-skill workers