Those concentrated markets also showed anticompetitive behaviour, with e61 finding more infringement notices from the Australian Competition and Consumer Commission in those areas than ones with more competition.
The largest number of infringement notices were issued in the airline industry, which has a small number of competing firms.
The think tank looked specifically at the service station market, finding that outlets kept prices higher for longer where they faced less nearby competition. It found this sector had undergone one of the biggest increases in market concentration since 2007.
Across the entire economy, there appeared to be falling competition in key markets.
“These findings raise concerns about the exercise of market power by dominant players in concentrated markets, suggesting that the observed rise in product market concentration is unlikely to be purely benign,” they found.
The research adds to recent pressure on the government over its decision to reject a proposal by Qatar Airways to boost the number of seats between Europe, Doha and Australia by between 800,000 and 1 million.
Prime Minister Anthony Albanese on Tuesday said Australia already had the most open aviation system in the world. Rejecting suggestions the government was too close to Qantas, he said the Qatar decision was business as usual.
Addressing the National Press Club, Leigh – a trained economist – said the decision on Qatar had been made on national interest grounds.
But he noted that where once overseas trips were available only to the rich, increased competition – along with higher incomes – had enabled many Australians to travel to other countries for a holiday.
Leigh said Australia should look to the European domestic airline system, where intense competition among many providers had driven down prices.
“I would hope to see more airline competition in Australia,” he said.
“I think bringing down the cost of aviation is important.
“I look to Europe with its range of low-cost carriers and see what looks like an even more competitive ecosystem. So moving us … towards that, I think is a long-term goal.”
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