And like most things that end in "opoly" it's the consumers, who pay the price. What is an oligopoly you ask? It refers to a state of limited competition, in which a market is shared by a small number of producers, and according to
David Leonhardt in The New York Times, a
new era of oligopoly might be costing you more than $5,000 a year.
In industry after industry, a few companies have
grown so large that they have the power to keep prices high and wages
low. The outsize growth of GAFA (Google, Apple, Facebook, Amazon) is only
one example. Most Americans also have a choice between only two
internet providers or four major airlines, while Home Depot and Lowe’s
have displaced local hardware stores and regional pharmacies have
been swallowed by national giants. There's even a NetLingo word for it: big box store.
Big Box Stores = America's New Oligopoly
Posted by
Erin
This isn’t some natural result of
globalization and technological innovation, said Thomas Philippon, an
economics professor at New York University. Europe has been far better
at containing the growth of these few companies, because it has been implementing market-based ideas that Americans helped pioneer. The
European Union created an impressively independent competition agency
that’s willing to block mergers.
Meanwhile, U.S. regulators—pushed by
lobbyists—keep finding ways to justify mergers with dubious theories
about money-saving efficiencies. Broadband service in the U.S. now
costs $67.69 per month, far more than in France ($31.14) or England
($39.58). The typical cellphone bill is $61.85 for 5GB of data, versus
just $14.95 in France or $18.30 in Sweden. Meanwhile, capital investment
stagnates. Meanwhile, the demise of the sole proprietorship was in part due to being Amazonned, yet a few years ago, Google opened it's first brick-and-mortar store in London. All this should inspire action, but clearly we have a
long way to go.
-
Erin Jansen,
Internet Specialist, Social Psychologist, Founder of NetLingo.com
Subscribe
to the NetLingo Blog via Email or RSS here | Subscribe to The Week magazine here
Subscribe to:
Posts (Atom)
Posts
