Thursday, February 16, 2017

Monopolies Are Worse Than We Thought

Monopolies Are Worse Than We Thought - Bloomberg View
"Economists are increasingly turning their attention to the problem of monopoly. 
This doesn’t mean literal monopoly, like when one utility company provides all the power in a city. 
Image result for monopolys badIt refers to market concentration in general -- when an industry goes from having 20 players to having only 10, or when the four biggest companies in an industry start taking a bigger and bigger share of sales. 
This sort of creeping oligopoly acts much like a literal monopoly -- it raises prices, limits market size and tends to make the economy less efficient.
There’s now evidence that market concentration could also be hurting workers, by decreasing the share of national income that they receive. 
It’s probably making inequality worse
I also suspect that creeping monopoly will prove to be one of the main reasons for decreasing business dynamism.  
And it could even be a contributor to slow productivity growth. 
In other words, many of the diseases in our economy can probably be traced, at least in part, to the problem of market concentration. 
And it’s getting worse:..."
Read on.
It's BAD!

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