Economists Jose Azar (University of Navarra IESE Business School) and Martin Schmalz (University of Michigan’s Ross Business School) have studied the idea that common ownership is “making companies and the economy less competitive.” This according to a recent article in Bloomberg.

The article highlights the fact that, in recent decades, U.S. industries have become more concentrated, an evolution that leads to a more monopolistic environment which in turn results in “higher prices and lower productivity, and it also probably contributes to income inequality.” This, along with the hypothesis posed by Azar and Schmalz, could result in an economy that is “less productive and more tilted toward investors rather than workers.”

According to the researchers, common ownership decreases competition mostly due to investor diversification—”When everyone owns a little piece of every company, then every company has the same set of owners.” The popularity of passive investing only amplifies the trend.

This notion, however, isn’t without its naysayers. The article cites an argument presented by MIT finance professor Antoinette Schoar that, “even if most of a company’s investors are big, well-diversified institutions and funds, it will always be a few highly motivated activist investors who drive corporate policy.” Large diversified investors, she argues, will let the activists “push managers to compete.”

But Azar and Schmalz’s theory is gaining traction, according to the article, which concludes that “instead of simply resolving to tax the rich more, politicians should think about how the structure of the economy can be reformed to reduce inequality while also boosting productivity.”