2 hours ago · Politics · 0 comments

For many years, I was a big proponent of the idea that increased market power was harming the U.S. economy in various ways. In the 2010s, in the economics world, circumstantial evidence began piling up that implicated increased industrial concentration as the culprit in a variety of recent negative trends. Here’s what I wrote in 2017, after reading a bunch of that evidence:[B]asically I see the case of the Market Power Story - or any big economic story like this - as detective work. We’re collecting circumstantial evidence, and while no piece of evidence is a smoking gun, each adds to the overall picture. IF the economy were being throttled by increased market power, we’d expect to see:1. Increased market concentration (Check! See Autor et al.)2. Increased markups (Check! See De Loecker and Eeckhout)3. Increased profits (Check! See Barkai)4. Decreased investment (Check! See Gutierrez and Philippon)5. Decreased wages in concentrated markets (Check! See Azar et al.)6. Increased prices…

No comments yet. Log in to reply on the Fediverse. Comments will appear here.