What If Companies Get Big Because They're Better? (opens in new tab)

(bloomberg.com)

6 pointsrickncliff6y ago2 comments

2 comments

> A productivity-based explanation for rising industry concentration would suggest dramatically different policies than the antitrust one does. The evidence uncovered by Autor and his collaborators buttresses the view that superstar firms are thriving because they are simply more productive than other firms, not because they have been given a special break by regulators. [emphasis mine]

And those different policies are? Regulating them like natural monopolies?

zozbot2346y ago

It's not clear. Antitrust policy only matters (in the sense of having positive effects!) in the presence of barriers to entry (non-contestability), and when these barriers are present it matters regardless of how the dominant firm got so big. So I think the folks who are pursuing this line of research are either confused, or at best they're reaching the same conclusions as mainstream scholarship in a very roundabout way.

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2 comments

CharlesColeman6y ago

And those different policies are? Regulating them like natural monopolies?

zozbot2346y ago

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