A real source of concern about the US economy: The return of oligopoly rents and the growing concentration of companies

The concentration of US companies (the weight of the largest companies in each sector) has increased sharply since the 1990s. This may be due to reduced vigilance by the competition authorities, the development of M&As thanks to favourable financing conditions, the presence of growing returns to scale, and entry barriers caused by innovations. Whatever the causes of the increase in the concentration of US companies , it increases companies’ market power in goods and services markets and their bargaining power in the labour market, and it therefore increases US companies’ profit margins. The presence of oligopoly rents in this context normally leads to: A shortfall in investment; Weak wages and increased inequality; A shortfall in growth (insufficient investment, excessively high prices, weak real wages, etc.). Developments in the United States show weak wages and increased inequality, but not a shortfall in investment or in growth.