Market Consolidation

Market consolidation refers to the process where companies in the same industry merge or are acquired, resulting in fewer, larger firms dominating the market. This can happen through mergers (where two companies agree to combine) or acquisitions (one company buying another). The goal is often to increase efficiency, reduce competition, and gain more market power, which can lead to economies of scale. While consolidation can foster innovation and lower prices, it may also raise concerns about reduced competition, potentially leading to higher prices and fewer choices for consumers.