Discussion paper

DP13174 Diverging Trends in National and Local Concentration

Using U.S. NETS data, we present evidence that the positive trend observed in national product-market concentration between 1990 and 2014 becomes a negative trend when we focus on measures of local concentration. We document diverging trends for several geographic definitions of local markets. SIC 8 industries with diverging trends are pervasive across sectors. In these industries, top firms have contributed to the amplification of both trends. When a top firm opens a plant, local concentration declines and remains lower for at least 7 years. Our findings, therefore, reconcile the increasing national role of large firms with falling local concentration, and a likely more competitive local environment.


Rossi-Hansberg, E, P Sarte and N Trachter (eds) (2018), “DP13174 Diverging Trends in National and Local Concentration”, CEPR Press Discussion Paper No. 13174. https://cepr.org/publications/dp13174