Like America, Britain suffers from a lack of competition

IN 2016 we decried falling competition in America, where profits have surged as industries have become more concentrated. This week, drawing on our own research and a study by the Resolution Foundation, a think-tank, we report that a similar—if not yet as severe—problem has taken root across the Atlantic (see ). That is bad for ordinary Britons, who pay 25% more for goods and services than they did in 2008, even as wages have grown by just 19%. Moreover, as Britain grapples with what sort of place it should be after Brexit, the whiff of oligopoly risks turning people against capitalism.If you split the British economy into 250-odd industry sectors, you will find that in nearly 60% of them the four biggest firms claim a larger share of revenues than they did a decade ago. Since the early 2000s the top 100 firms, excluding finance and oil, have seen their share of economy-wide takings creep up, from 18.5% to 23%. Profit margins have risen by nearly four-fifths since 1980, and are above the European average. So far, profits as a whole have not gobbled up a larger share of GDP, perhaps because small firms are doing worse and because the largest companies, such as Apple and Amazon, book profits offshore. But the long-run trend in profit margins is worrying.