Insights #14: Winner-takes-all dynamics are not confined to tech firms or to the United States: Evidence on profit concentration from 21 economies
The notion that commercially unassailable superstar firms generate excess profits has taken hold in the United States. Evidence of the concentration of economic—as opposed to accounting—profits of publicly-listed companies in 21 economies from 2018 to 2022 is marshalled here. This allows for US experience to be benchmarked against other economies. Economic profit concentration is found to be more severe in many other nations. Cross-sectoral comparisons reveal that the IT sector does not have the most concentrated economic profits.