Bottom-up Markup Fluctuations


Type
Working Paper
Change log
Authors
Burstein, A. 
Carvalho, V. M. 
Grassi, B. 
Abstract

We study markup cyclicality in a granular macroeconomic model with oligopolistic competition. We characterize the comovement of firm, sectoral, and economy-wide markups with sectoral and aggregate output following firm-level shocks. We then quantify the model’s ability to reproduce salient features of the cyclical properties of markups in French administrative firm-level data, from the bottom (firm) level to the aggregate level. Our model helps rationalize various, seemingly conflicting, measures of markup cyclicality in the French data.

Description
Keywords
Markup Cyclicality, Oligopolistic Competition, Firm Dynamics, Granularity, Aggregate Fluctuations
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2024-01-05 10:41:46
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