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This paper provides an empirical assessment of the degree of competition in Hong Kong SAR using industry-level data. Although due to data limitations only approximate measures of competitiveness can be estimated, the results do suggest that Hong Kong SAR is as competitive as a typical OECD economy. The dramatic shift of the economy toward services over the last decade has also made it slightly less competitive on average. Imperfect competition is not leading to counter-cyclical markups and slower price adjustment as some theories predict, however, since markups are more pro-cyclical than in OECD countries. Lastly, markups are sufficiently imperfectly competitive in both Hong Kong SAR and the OECD to significantly downwardly bias growth accounting estimates of total factor productivity in Asian NICs vis-à-vis OECD countries.

Finance: General --- Labor --- Macroeconomics --- Industries: Manufacturing --- Production and Operations Management --- Price Level --- Inflation --- Deflation --- Business Fluctuations --- Cycles --- Oligopoly and Other Imperfect Markets --- Industrial Organization and Macroeconomics: Industrial Structure and Structural Change --- Industrial Price Indices --- General Financial Markets: General (includes Measurement and Data) --- Industry Studies: Manufacturing: General --- Labor Economics: General --- Production --- Cost --- Capital and Total Factor Productivity --- Capacity --- Wages, Compensation, and Labor Costs: General --- Labour --- income economics --- Finance --- Manufacturing industries --- Competition --- Manufacturing --- Total factor productivity --- Labor share --- Financial markets --- Economic sectors --- Labor economics --- Industrial productivity --- Wages --- Hong Kong Special Administrative Region, People's Republic of China