Work

Intangible assets and imperfections in product and labor markets

Year: 2026

Type: article

Abstract: This paper develops a micro-founded framework linking price-cost and wage markups to intangible assets. Intangible assets, once created, are a source of firm rents. Owing to limits to enforceable ownership and the non-rival nature of knowledge, these rents can be both retained by the origin firm and transferred to a competitor through poaching of workers. Search and matching frictions affect labor mobility and result in bargaining over rents between the firm and the worker. This environment generates hold-up in intangible asset creation and motivates rent sharing. Under non-compete agreements, poached workers face start delays that weaken outside options. Using microdata from the Netherlands, we document higher price-cost and wage markups in more intangible-intensive firms and lower wages for workers with non-compete agreements, consistent with the model.

Source: European Economic Review

DOI: 10.1016/j.euroecorev.2026.105309

Authors: Eric Bartelsman, Sabien Dobbelaere, Alessandro Zona Mattioli

Institutions: Tinbergen Institute, Luxembourg Institute of Socio-Economic Research, Vrije Universiteit Amsterdam, University of Amsterdam

Language: English

Topic: Merger and Competition Analysis

Subfield: Economics and Econometrics

Field: Economics, Econometrics and Finance

Domain: Social Sciences

SDG: Decent work and economic growth

Open Access status: hybrid

Estimated APC paid: $3,690