Unprecedented Growth of Big Companies

Since 2000, the largest companies have experienced exceptional growth and sustained high returns on capital that go beyond conventional economic trends. This growth has led to significant wealth creation and a notable gap in returns between the top quintile of companies and the rest. The book 'The New Goliath's' suggests that large technology firms have achieved this through investments in proprietary software, giving them scale advantages and customer differentiation. These intangible investments are not diffusing to benefit other players in the market. While there are variations among the 'Magnificent Seven' companies, analyzing economic profit shows their significant impact and success.