Research on the Affect of Urbanization to Enterprise Markup Rate

This paper brings the externality of urbanization and its impact on fixed cost and variable cost into the analysis framework, and focuses on how these factors affect the enterprise markup rate. It has important policy implications for promoting urbanization to improve the high-quality development of enterprises. Based on data from industrial enterprises and various statistical yearbooks, this paper tests the effect of urbanization on enterprise markup rate. It is found that urbanization has an inhibitory effect on the enterprise markup rate, the market competition effect and cost increase effect are important transmission channel, urbanization has reduced the dispersion of enterprise productivity and markup rate, promoting the improvement of regional resource allocation efficiency. For enterprises with high research and development level and low financing constraint, urbanization has relatively small inhibitory effect on the markup rate, however, for enterprises with weak entry barrier, low productivity, and small scale, as well as private enterprises, the inhibitory effect of urbanization on the markup rate will be more significant.