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The growing concentration of economic power in a few giant technology companies helps explain weak overall productivity growth and labour's low share of US GDP, writes Rana Foroohar. A politically powerful oligopoly in the form of the Faangs (Facebook, Amazon, Apple, Netflix and Google) has made it difficult for other companies to grow and should be cause for concern.

American antitrust watchdogs should look to Brussels, where the EU’s competition commissioner Margrethe Vestager last week held Google's feet to the fire over using its dominant Android software to favour its search business, Rana argues. The lack of a European tech titan should not be seen as a lack of innovative spirit, but rather a sign that the EU has successfully fostered competition.

Oligopoly Markets
© Matt Kenyon

Wolfgang Münchau argues that Europe should weigh its response to US tariff threats with care. The best option, he writes has two components: a unilateral cut in the EU’s own 10 per cent car tariff and Germany and the Netherlands should commit to binding measures to cut their current account surpluses over time to less than 3 per cent of GDP.

Anne-Marie Slaughter writes that Donald Trump and Vladimir Putin want to create a new world order. Those people who see an arc of progress bending towards peace and universal human rights must appreciate the full scope of the threat they pose to our 20th-century global architecture.

Andy Haldane advocates the use of portfolio theory during the hiring process. Rather than simply weighing up candidates against one another, recruiters should consider which one brings skills and experiences that the existing organisation lacks.

What you’ve been saying

Maybe Royal Mail has misunderstood GDPR — Letter from Jon Baines:

Your report “Royal Mail pays price for EU privacy reforms” (July 18) says that the General Data Protection Regulation (GDPR) stipulates that “processing personal data requires the subject’s consent”. This is a canard that refuses to die: in fact, there are a number of bases for processing personal data, of which the subject’s consent is but one. GDPR’s recitals make clear that a business’s legitimate interests can be the basis for direct marketing, and in the context of postal marketing, the law is clear that a recipient’s consent is not required. Royal Mail actually ran a marketing campaign stating this, prior to GDPR’s coming into effect. Maybe something else is behind the drop in business? Or maybe Royal Mail is now victim of this unfortunate and common misunderstanding about GDPR and consent.

Comment by When Im 64 on The perils of pyjama paralysis:

Flexibility is the key. A workplace which permits smart casual (no trainers except on dress down Friday) makes for a less formal and hierarchical atmosphere. Those in creative roles don’t want to restrict blood flow to the brain by wearing ties, so that’s fine. On the other hand, when facing clients or meeting prospects, a half decent suit (no shiny crumpled M&S numbers), shirt (ironed) and tie (small knot correct length) with polished shoes will usually fit the bill. Chaps who fail in some way to meet these basic criteria do leave a lasting impression for all the wrong reasons. Or maybe it’s just me, 36 going on 66, and having worn a tie daily during term times since I was 6. But standards do matter in whatever you wear in the professional/corporate sphere. I’m not qualified to comment on how ladies should dress!

I value your journalists’ personal opinions — Letter from Christopher Hodges:

While respecting the views of the four female signatories to the letter headlined “Lack of diversity in your summer reading list” (July 14), I consider they devalue their campaign for less sexism in economics by choosing to highlight the lack of women included in what were surely Martin Wolf’s personal recommendations. The number of books written by women in Mr Wolf’s selection (one out of 12) was similar to the proportion in most of the other 22 categories. One of the reasons I read the Financial Times is to benefit from the personal opinions of journalists of the calibre of Mr Wolf. It would be a sad day indeed if your columnists were forced to comply with an arbitrary standard of political correctness. At least out of the 11 featured individuals making summer reading suggestions, six were women!

Today’s opinion

Bank of Japan faces the return of very low inflation
None of the central bank’s indicators have risen in line with the official target

 A light shines on the concentration of power in Silicon Valley
Oligopoly is showing itself to be the economic and political challenge of our time

 Europe should weigh its response to US tariff threats with care
It would do well to concentrate on correcting imbalances in the eurozone

 Donald Trump and Vladimir Putin want to create a new world order
We should take their vision of unfettered state sovereignty seriously

 Diversity versus merit is a false choice for recruiters
Imagine staff as assets in a portfolio and the maths can show the benefit

 Lessons for May from the torrid battles of Callaghan’s era
The dark days of seventies Britain contain clues about how to handle political rifts

FT View

The FT View: US should stand by its offer to talk to the Taliban
It should accept that the only way to end the war in Afghanistan is to negotiate

 The FT View: Even-keeled bosses deserve plaudits for their steadiness
Steady chief executives know preening is no substitute for performance

The Big Read

The Big Read: Can factor investing kill off the hedge fund?
Data-driven funds that systematically exploit human weaknesses are disrupting traditional asset management

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