Monopolies Could Take Advantage of Trump’s Tariffs to Hurt Small Businesses and Consumers
As Trump’s chaotic tariff announcements begin to impact global supply chains, Research Director Matt Stoller wrote an important analysis of how coming price and supply shocks could benefit giant corporations at the expense of small businesses. Corporations with market power, such as Albertsons, are already announcing they will not accept price increases from suppliers—creating something called the “waterbed effect,” where suppliers will compensate for these demands by raising prices on smaller stores. The dynamic also works in reverse, where retailers force small suppliers to give price concessions while accepting hikes from bigger suppliers.
