"...The markets are evolving along with what’s known as a 'winner take all' economy. I’m referring to a prediction made in 2005 in the Journal of Economics & Management Strategy by Thomas Noe of Oxford University and Geoffrey Parker of Dartmouth College. The researchers predicted that, because of so-called 'network' effects in an internet-based economy, industries will become increasingly dominated by their largest companies," reports MarketWatch.

..."Dartmouth's Parker said in an interview that it’s not particularly surprising that profits and market caps are currently correlated. It would be more surprising if they were not, as was the case at the top of the internet bubble. Absent such a disconnect, he said, the concentration of market cap in the largest companies 'is not a signal of a top-heavy market.'

"This doesn’t mean that the stock market isn’t vulnerable to a big decline, Parker added. The point instead is that, if indeed the market does decline, it will be for other reasons than the concentration of market cap among the largest companies."

Also appeared in: MSN