TY  - RPRT
        AU  - Castelan, Carlos Rodriguez
AU  - Araar, Abdelkrim
AU  - Malásquez, Eduardo A.
AU  - Olivieri, Sergio
AU  - Vishwanath, Tara
        TI  - Distributional Effects of Competition: A Simulation Approach
        PY  - 2021/Jan/
        PB  - Institute of Labor Economics (IZA)
        CY  - Bonn
        T2  - IZA Discussion Paper
        IS  - 14043
        UR  - https://www.iza.org/publications/dp14043
        AB  - Understanding the economic and social effects of the recent global trends of rising market concentration and market power has become a policy priority. To fill this knowledge gap, this paper introduces a simple simulation method, the Welfare and Competition tool (WELCOM), to estimate with minimum data requirements the direct distributional effects of market concentration through the price channel. Using this simple yet novel tool, this paper illustrates the likely distributional effects of reducing concentration in two markets in Mexico that are known for their high level of concentration: mobile telecommunications and corn products. The results show that increasing competition from four to 12 firms in the mobile telecommunications industry and reducing the market share of the oligopoly in corn products would achieve a combined reduction of 0.8 percentage points in the poverty headcount as well as a decline of 0.32 points in the Gini coefficient.
        KW  - poverty
KW  - inequality
KW  - market concentration
KW  - distributional effects
KW  - simulation
KW  - Mexico
        ER  -