Monopolies and the Economy

Sam Long has an interesting article about how the rise of monopolies is destroying our economy. Much of the article is a review of Matt Stoller’s Goliath: The 100-Year War Between Monopoly Power and Democracy.

Perhaps, the most interesting part of the article is the following:

For all of the bleating about innovation at business schools and elsewhere, American entrepreneurship is in a perilous state. Despite a ten-year bull market, annual small business formation is still at only two thirds of its pre-recession levels. Over a longer horizon the picture only grows bleaker. In the 1970s new firms (defined as those less than one year old) accounted for approximately 15 percent of all American businesses. Forty years later that percentage hovers in the mid-single digits. Our winner-take-all economy is creating fewer businesses and, as a result, inferior investment opportunities. Our business culture now seems purpose-built to celebrate founders and companies whose entire business model can be described as seeking monopoly, while avoiding mention of the collateral damage to other sectors of the economy.