this post was submitted on 17 Jul 2023
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So what hasn’t been true for decades then?
Your question isn’t a bad question though so I’m gonna answer it in good faith. Basically when regulators look at whether industries are competitive a huge factor they look at is whether firms have pricing power and their market share. There are a couple other things they look too like purchasing power with suppliers.
If you look at a firm like Facebook (META) it has both high margins (>30%)and between Google has 80% market share in online advertising. That’s an industry that is oligopolistic and possibly a case for antitrust measures.
In a nut-shell the question is “how much of the pie is consumer surplus vs producer surplus.”
If you look at grocery you’ll see the market share is really broken up so yeah they’re doing a lot of volume but you have a lot of choice. Volume itself doesn’t really tell us anything about competitiveness.
As you’re thinking about this ask and still disagree ask “what would a good objective measure be for competitiveness?” We need some actual quantifiable metric, so what would your counter-proposal be then?