I'm not an economist but my armchair opinion thinks you're wrong about quality going up; competition is about driving pricing down and undercutting others, cutting corners as much as possible.

Take Amazon or the Chinese webshops, they've flooded the market with products that do the same thing but cheaper, but whose quality is way lower.

Take the acquisitions of e.g. power tool brands by investors, who then use the brand's brand awareness and quality inertia to cut costs and boost their profit margin.

Take hotels, which used to feel luxurious but which have over time been redesigned to require minimal maintenance and personnel.

The only competitive market where they try to one-up each other on quality is aimed at the rich where money is not an issue. The middle ground is disappearing.