Dynamic Antitrust Discussion Series: Antitrust and Inflation

As inflation rates have risen to levels not seen in 40 years, antitrust populists have been quick to lay the blame for this crisis at the doorstep of the supposed increase in corporate concentration. Senator Elizabeth Warren (D-MA) suggests companies are hiding “behind claims of increased costs to fatten their profit margins” while economist Hal Singer has said that “general inflation can serve as a pretext for a coordinated price hike.” This view that corporate concentration is a root cause of inflation has led to calls for more aggressive antitrust enforcement—including from President Biden who has called on the Federal Trade Commission and the U.S. Department of Agriculture to investigate price increases and anti-consumer behavior in the petroleum and meatpacking industries. However, others have argued that more aggressive antitrust enforcement during this inflationary period could put even more upward pressure on prices. For example, economist Larry Summers has said that “policies that attack bigness can easily be inflationary if they prevent the exploitation of economies of scale or limit superstar firms.”

Watch the latest installment of the Dynamic Antitrust series, where Julie Carlson moderates a panel with antitrust and inflation experts to get their views on the relationship between corporate concentration and inflation.