E&M

Financial concentration, long viewed as a sign of efficiency and success, can become a source of dependence and systemic vulnerability. Its main forms include the concentration of public debt in a few large economies, European firms’ dependence on bank financing, and the concentration of stock markets and corporate ownership. These dynamics amplify shocks, restrict access to capital, and exacerbate inequality. The solution lies not in penalizing scale, but in developing alternatives through diversified sources of finance, accessible capital markets, systemic oversight, antitrust policies, and effective governance rules.