In recent years, the US retail and media sectors have experienced significant disruption thanks in large part to shifting consumer demands and technological innovation.
As a result, both are increasingly dominated by a handful of large firms – often referred to as ‘Big Tech’ or ‘FAANG’ in the popular press – that command rising market share. Looking at this heightened concentration from the traditional economists’ point of view, one could conclude that competition in these sectors must be waning. But is that truly what’s happening?
In this episode, Jeff Meli, Head of Research, and Jim Martin, US Credit Strategist, take a close look at competition in the retail and media sectors using the Barclays Competitiveness Indicator (BCI). The BCI assesses the competitive landscape using the characteristics associated with a competitive environment: labour share of income, business investment and business dynamism. They debate whether Big Tech companies are beneficial or detrimental to competition in each sector and the implications for investors.
For more information on this topic, download a copy of our fifth Impact Series report, Increased corporate concentration and the influence of market power (PDF, 2.4MB).