Briefing
Measuring Labor Market Power in the U.S. Manufacturing Sector
Yeh, Chen (2022-01)
Policymakers have recently considered several policies to mitigate a perceived increase in employers' market power. However, the lack of direct evidence on labor market power has complicated the policy debate. In this article, we show that the degree of employers' market power is substantial and widespread in the U.S. manufacturing sector. A worker in the average manufacturing plant receives only 65 cents on each dollar generated in the margin. Furthermore, we propose a novel aggregate measure for labor market power. We find that employers' market power decreased between the late 1970s and ...
Richmond Fed Economic Brief , Volume 22 , Issue 01

Briefing
Price Changes and Monetary Non-Neutrality
Yeh, Chen (2022-10)
Economists have not reached a consensus on the effectiveness of monetary policy for stimulating short-run consumption. While quantitative models are typically disciplined through average pricing moments in the data, this is not sufficient to draw conclusions on monetary non-neutrality. In this article, we quantify the importance of the age-dependence of pricing moments for monetary policy. In particular, we show that newer products change their prices more often and by a larger amount. Furthermore, these patterns are supported by a price experimentation narrative. Finally, we quantify that ...
Richmond Fed Economic Brief , Volume 22 , Issue 41

Briefing
Why Are Startups Important for the Economy?
Yeh, Chen (2023-02)
Startups come in all shapes and sizes. While small in number, a small group of successful startups is important for understanding aggregate outcomes such as employment and productivity. In this article, we look at some distinguishing characteristics of startups and what makes them important for the aggregate economy. Furthermore, we dig into the cause behind the long-run decline in U.S. entrepreneurism and whether the recent pandemic broke these trends. While the recent surge in business applications seems encouraging at first, there are signs that it reflects a restructuring of the economy ...
Richmond Fed Economic Brief , Volume 23 , Issue 06

Briefing
How Costly Is Rising Market Power for the U.S. Economy?
Yeh, Chen (2023-07)
We survey the recent, active debate on market power in the U.S. economy. While typical studies on market power focused on narrow industries due to data constraints, the relevance of market power for the aggregate economy was reinvigorated by a study focusing on publicly traded firms that documented a significant rise in U.S market power since the 1980s. This article is meant to provide a bird's-eye view of the (sometimes heated) discussion on market power. Furthermore, we examine the macroeconomic consequences of a rise in U.S. market power.
Richmond Fed Economic Brief , Volume 23 , Issue 24

Briefing
Can an Individual Large Firm Impact the U.S. Business Cycle?
Yeh, Chen (2021-08)
Richmond Fed Economic Brief , Volume 21 , Issue 24

Briefing
Developments in Antitrust Policy Against Labor Market Monopsony
Yeh, Chen (2024-03)
Antitrust policies have traditionally focused on merger-induced damages to consumers caused by monopoly. Recently, a literature on monopsony has flourished, particularly when applied to labor. As a result, it would be natural to think about the harm to workers caused by mergers. In this article, we survey how the literature and empirical evidence on labor market power has evolved and how this has led to proposals of regulatory tools that can be used to analyze merger-induced harm on workers.
Richmond Fed Economic Brief , Volume 24 , Issue 11