High profits are a result of scarcity power
When it is easy for new competitors to enter an industry, high profits typically mean that a business really does offer some scarce, valuable resource (e.g. superior service or product). In this case, the market is operating efficiently .
However, if it is difficult to enter an industry, either due to licensing requirements, regulations, or high cost to entry ("green belts"), then that scarcity is artificial and the market is acting inefficiently.
- Harford, Tim. The Undercover Economist: Exposing Why the Rich Are Rich, the Poor Are Poor--and Why You Can Never Buy a Decent Used Car! Oxford ; New York: Oxford University Press, 2006.