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No.
Economists say corporate price markups are not a major cause of inflation.
The greed claim was made Sept. 27, 2024, by Democrat Kristin Lyerly. She is challenging Republican Tony Wied for an open U.S. House seat for the Green Bay, Wisconsin, area.
Lyerly’s campaign cited a report by the progressive think tank Groundwork Collaborative. It accused corporations of “gouging consumers,” claiming profits drove 53% of inflation in mid-2023.
The libertarian Cato Institute criticized the report’s methodology. Economists disagree with its conclusion.
The Federal Reserve Bank of San Francisco said that since the COVID-19 pandemic, price markups have risen substantially in areas such as motor vehicles and petroleum, but overall, markups remained flat and have not been a main inflation driver.
Economists told PolitiFact rising costs for goods, labor and real estate are the main inflation drivers. Trillions in COVID stimulus, near-zero interest rates and the Russia-Ukraine war were also factors.
This fact brief is responsive to conversations such as this one.
Sources
WBAY TV-2 | Green Bay, WI: Dr. Kristin Lyerly and Tony Wied in the 8th Congressional District debate on WBAY TV-2
New York Times: I Listened In on Big Business. It’s Profiting From Inflation, and You’re Paying for It.
Groundwork Collaborative: Inflation Revelation: How Outsized Corporate Profits Drive Rising Costs
Cato Institute: New Nonsense on Profit-Driven Inflation
Federal Reserve Bank of San Francisco: Are Markups Driving the Ups and Downs of Inflation?
PolitiFact: Sen. Bob Casey said ‘prices are up’ because of ‘scheming’ corporations, but many economists disagree
PolitiFact: Corporate profits do not drive inflation, but inflation boosts company profits
CNN: The truth behind Harris’ inflation and corporate greed claims
American Institute for Economic Research: Fact-Checking “Greedflation”
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