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Inequality and concentration: Are the poor more exposed to concentrated markets?

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  • Stephen Davies

    (Centre for Competition Policy and School of Economics, University of East Anglia)

  • Franco Mariuzzo

    (Centre for Competition Policy and School of Economics, University of East Anglia)

Abstract

This paper contributes to the empirical literature on the distributional impact of competition. Using a novel combination of the national survey of household expenditure and the business structure database for the UK, it establishes two descriptive facts. First, the poor are relatively more dependent than the rich on their product purchases and services supplied by more concentrated markets. Second, it sends a significant negative correlation across products and services between the income elasticity of demand and the concentration of the industries supplying those products. At this stage, we draw no inferences from these results. However, this analysis points to some interesting research questions and policy issues concerning the nature of competition in those industries which supply the necessities in consumption.

Suggested Citation

  • Stephen Davies & Franco Mariuzzo, 2022. "Inequality and concentration: Are the poor more exposed to concentrated markets?," Working Paper series, University of East Anglia, Centre for Competition Policy (CCP) 2022-01, Centre for Competition Policy, University of East Anglia, Norwich, UK..
    • Handle: RePEc:uea:ueaccp:2022_01
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    References listed on IDEAS

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    1. Joshua Gans & Andrew Leigh & Martin Schmalz & Adam Triggs, 2019. "Inequality and market concentration, when shareholding is more skewed than consumption," Oxford Review of Economic Policy, Oxford University Press and Oxford Review of Economic Policy Limited, vol. 35(3), pages 550-563.
    2. Sean F Ennis & Pedro Gonzaga & Chris Pike, 2019. "Inequality: A hidden cost of market power," Oxford Review of Economic Policy, Oxford University Press and Oxford Review of Economic Policy Limited, vol. 35(3), pages 518-549.
    3. William S. Comanor & Robert H. Smiley, 1975. "Monopoly and the Distribution of Wealth," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 89(2), pages 177-194.
    4. Creedy, John & Dixon, Robert, 1998. "The Relative Burden of Monopoly on Households with Different Incomes," Economica, London School of Economics and Political Science, vol. 65(258), pages 285-293, May.
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    Cited by:

    1. Adam Cellan-Jones & Hussein Farook & Riccardo Ferrari & Maxwell Harris & Alex Rutt & Mike Walker, 2022. "Recent Developments at the CMA: 2021–22," Review of Industrial Organization, Springer;The Industrial Organization Society, vol. 61(4), pages 381-403, December.

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    Keywords

    Concentration; Inequality;

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