The authors of the books don’t really need any antitrust protection

It’s the latest twist in modern antitrust enforcement, which is no longer just concerned about consumers paying too much. The latest suit argues that workers in a more concentrated market will have less power and that puts them at a disadvantage. It is true that there is more market consolidation, but it is not clear that this hurts writers. Modern distrust often feels like a solution in search of a problem. This case is an example.

Market concentration is not limited to publication. There are fewer firms in more than 75% of US industries compared to the 1990s. Traditionally, when a few firms dominate an industry, this means concentrated market power and customers paying more. This time consumers may pay less for many items such as books, but there is cause for concern that workers may suffer. The DOJ and the Federal Trade Commission have begun to take an active interest in labor market competition. Over the years, some economists have become concerned about increased monopolistic power, when fewer companies are hiring people, which they argue lowers wages. In fact, there is evidence that more concentrated industries have seen a larger decline in labor’s share of income.

But before the government stops this merger, we need to understand why the big companies are doing so well and if they are really hurting workers. The bigger is not necessarily the worse, and the fact that labor’s share of income has fallen may reflect a world where labor is less valuable.

The increase in market density did not result from uncontrolled market power. A more likely explanation is that the world changed and market structures changed with it. A global technology-driven world created a winner-all-economy. The ability to reach customers around the world offers huge rewards to companies that can expand rapidly. This is partly due to network effects—your product is worth more if many people use it. More users also means scale and access to data. Large firms will have some clear advantages in such markets. Large publishers claim they need to merge in order to take advantage of the scale that Amazon.com has to compete with, which is reducing publishers’ profits by driving down book prices and getting into the self-publishing business. .

Reducing industry concentration will not change global economic trends or turn back the clock on technology. And it is not necessary that workers should be protected by policy.

First, winner-take-all firms pay better. If you’re lucky enough to work for one, your wages will increase exponentially. One study estimates that a third of the increase in income inequality comes from the gap between people working in superstar firms and everyone else. If large firms were using their power to pay workers less, they would pay less, not more. Perhaps breaking them down would make larger firms less productive and that would reduce inequality among firms. But it will hurt the economy.

Second, even though there are fewer employers nationally, a recent paper estimates that there are more employers at the local level. Previously, if you lived in a small town, you could probably work at a local hardware store. Now Home Depot and Lowes are too. More concentration at the national level can mean more local competition. This is bad for small local businesses, but better for employees because there is more demand for their work and larger companies offer better stability and higher pay.

Third, in some ways workers have more power than ever before. Technology makes it possible to find and sell your services to more employers, whether it’s gig and contract work or just job posting websites. The book market is an example of this. Writers don’t need big publishers as much as they used to. Self-publishing has become more widely accepted, and is more easily done with Amazon and Substack. Social media and podcasts have leveled the playing field when it comes to book promotion.

There is reason to be concerned about concentration. This can reduce competition in some cases, but it is not necessarily bad for workers. If this is an important justification for preventing mega mergers of the publishing industry, then there is a better use of government resources.

Allison Schrager is a Bloomberg Opinion columnist. She is a Senior Fellow at the Manhattan Institute and the author of An Economist Walks into a Brothel: And Other Unexpected Places to Understand Risk.