Appearance of Unstable Monopoly State Caused by Selective and Concentrative Mergers in Business Networks
Scientific Reports
Recently the growth mechanism of firms in complex business networks has become a new target of scientific study given the increased availability of high-quality enterprise microdata. Here, we paid attention to comprehensive data on M&A events spanning 40 years and derived empirical laws by applying methods and concepts of aggregation dynamics of aerosol physics. We found that the probability of a merger between big firms is bigger than that between smaller ones, and such tendency is enhancing year by year. We introduced a numerical model simulating the whole ecosystem of firms and showed that the system is already in an unstable monopoly state in which growth of middle-sized firms are suppressed.
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Tokyo Institute of Technology, Julian Maluck, Reik V. Donner, Hideki Takayasu, and Misako Takayasu