Aggregate Concentration in the Global Economy: Issues and Evidence

Abstract

In this paper I present new and original evidence concerning global aggregate concentration. To my knowledge, this evidence constitutes the first systematic effort to measure global aggregate concentration. The data are available only for the years 1994-2001 and require some compromises and approximations. For 2001, the largest 500 global companies' employment accounted for 1.60% of the world labor force, or 9.92% of OECD employment. These companies' profits amounted to 0.94% of world GDP or 4.16% of world gross domestic savings (GDS); their profits also amounted to 1.18% of OECD GDP or 5.62% of OECD gross national saving (GNS). Similar estimates are available for the largest 50 global companies. The time trends for 1994-2001 show a mixed picture. If employment is the basis for the measurements, the largest 50 global companies accounted for a slightly decreasing share of aggregate employment over time. If, instead, profits are the basis for the measurements, then the 50 largest companies accounted for an increasing share over these same years. But this latter trend is likely overstated and is unlikely to be sustained. Future years will yield more data that can be used to check these trends and refine these measurements.