The price of power: Why rising markups hurt innovation and widen inequality

Educatie

Over the past four decades, the US has seen rising market power, slowing productivity growth, and deepening wealth inequality. This column explores how declining competition may be the common culprit. Weak competition lets dominant firms raise prices, suppress wages, and stifle innovation, thereby slowing economic growth. Meanwhile, higher asset returns benefit the wealthy, widening inequality by amplifying differences in savings behaviour. Rising markups drive stagnation and wealth

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