Market Dominance in the Digital Age

66 Pages Posted: 6 Oct 2020 Last revised: 27 Sep 2023

See all articles by Logan P. Emery

Logan P. Emery

Rotterdam School of Management, Erasmus University

Date Written: September 26, 2023


I document that the network structure of the online economy significantly contributes to rising industry concentration. Firms that are central in the online economy benefit more from increased economies of scale and network effects resulting from digitalization. Industries with firms that are more central become more concentrated and central firms have larger increases in market share. These results are driven by firms’ ability to generate revenue, as evidenced by central firms earning higher risk-adjusted returns and having more positive earnings surprises. Finally, centrality is more strongly associated with increasing productivity than increasing markups, providing generally positive welfare implications.

Keywords: Industry Concentration, Internet, Network, Digitalization

JEL Classification: D22, E22, G32, O33, L1, L86

Suggested Citation

Emery, Logan, Market Dominance in the Digital Age (September 26, 2023). Available at SSRN: or

Logan Emery (Contact Author)

Rotterdam School of Management, Erasmus University ( email )

RSM Erasmus University
PO Box 1738
Rotterdam, 3062 PA

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