Publications
Publications
- 2011
- Adam Smith Review
Too Big to Live: Why We Must Stamp Out State Monopoly Capitalism
Abstract
The problems of excessive economic concentration, so lucidly and incisively analysed here, are not limited to the financial services industry. For the problem is now widespread: while five firms control 80% of the banking industry, a similar or greater concentration is found in industries ranging from energy and telecommunications to tobacco and soft drinks. The dangers of excessive market concentration are greater in finance, however, because of the systemic importance of credit to the economy and the now widely held belief that governments must intervene to prevent the failure of big banks. But what is to be done? If we are to break up the institutions that are "too big to fail," does that contradict the benefits of economies of scale, the driving force of globalization? Or, if these huge firms are to be left as they are, and we are to rely on tighter, better regulation to control them, will not human creativity and ingenuity always find a way around any new rules, as it did in this last crisis? And finally, how can—in practical terms—we get rid of the "too big to fails," without increasing state intervention further?
Keywords
Citation
Ferguson, Niall. "Too Big to Live: Why We Must Stamp Out State Monopoly Capitalism." Adam Smith Review, no. 6 (2011): 327–340.