Money & Macro Talks Why monopolies are eating our economies ft. Jan Eeckhout
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Oct 23, 2025 Jan Eeckhout, a research professor at the Barcelona School of Economics and author of The Profit Paradox, discusses the alarming trend of rising monopolies and their impact on the economy. He explains the profit paradox, where a few firms accumulate immense profits while many struggle. Jan highlights evidence of growing market power, driven by digital technology and lackluster antitrust enforcement. He advocates for policies like interoperability to promote competition and examines the negative effects on wages and innovation, urging for more equitable market practices.
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Stock Market Gains, Personal Losses
- Jan Eeckhout describes a friend from Silicon Valley whose startups failed despite a booming stock market.
- The waiter in the bar also reported wages unchanged after 17 years, illustrating the disconnect between market gains and typical workers.
Profits Concentrated In A Fat Tail
- Eeckhout shows three consistent measures: markups, profit rates, and stock valuations all rose and concentrate in a few firms.
- The average rises mask a fat tail: a small number of firms drive most of the profit increases.
Market Value Is Driven By Few Firms
- Stock market valuations reflect expected future profits and show extreme concentration in a few firms.
- Recently seven firms accounted for 25% of total US market value and half of the market's recent growth.
