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Scope, Scale and Concentration: The 21st Century Firm

  • Series
  • Speaker(s)
    Gordon Phillips (Dartmouth College, United States)
  • Field
    Spatial Economics, Finance, Organizations and Markets, Macroeconomics
  • Location
    Tinbergen Institute Amsterdam, room 1.60
  • Date and time

    August 24, 2023
    14:00 - 15:00


We provide evidence that over the past 30 years, U.S. firms have expanded their scope of operations. Increases in scope and scale were achieved largely without increasing traditional operating segments. Scope expansion significantly increases valuation and is primarily realized through acquisitions and investment in R&D, but not through capital expenditures. We show that traditional concentration ratios do not capture this expansion of scope. Our findings point to a new type of firm that increases scope through related expansion, which is highly valued by the market. Joint paper with Gerard Hoberg.