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Is it really price fixing or just copying strategies? There comes a point where the optimal strategy for a firm is to simply do what every one else is doing. Pr

Is it really price fixing or just copying strategies? There comes a point where the optimal strategy for a firm is to simply do what every one else is doing. Price fixing requires an element of collusion.

ClumsyPilot 5y ago
"the optimal strategy for a firm is to simply do what every one else is doing" Such a convenient worldview, conpwtition doesn't exist, banks did nothing wrong prior to 2008, etc.
- Dracophoenix 5y ago
  Competition requires players to remain in the game. No one is required to make a profit-losing decision realized or unrealized. If they do make such a decision, they're one step closer to going out of business. Survival is an incentive to taking the correct actions. In an iterative prisoner's dilemma, the optimal solution is most often tit-for-tat or some variation of it. It's logical for one firm to do the same as another until it can obtain a strong hold on a profit-making activity that gives it more degrees of freedom with regards to its strategies. At that point a firm can move from merely surviving to experimentation or it can continue to milk the opportunity for all its worth. Your cartel argument requires more than sameness of strategy. It requires motive and direct action towards achieving a forced equilibrium (e.g. willfully punishing other market players in concert to dissuade the use of alternative profit-making strategies). I never brought up banks. What do they and the 2008 recession have to do with online stores and 30% cuts in 2021?
  - ClumsyPilot 5y ago
    "direct action towards achieving a forced equilibrium" Do you expect the head of Apple and Google to sign a public document "hereby we form an illegal cartel"? At a minimum the competition and market authority should take an interest as to why there is no competition. If they botheresld to investigate, maybe we would actually find out if there is any wrongdoing.
    - Dracophoenix 5y ago
      No. But I don't take a 30% cut as an indication of cartel-building when it has existed since Jobs first announced the App store in 2008 [1] and was done at a time where the Walmarts and Best Buys of the world charged 70% if not more. Quite recently Apple sought fit to reduce it's revenue share to 15% after the first year on the store store. Google has done the same. I wouldn't call putting more money in the pockets of developers a lack of competition. [1]https://m.youtube.com/watch?v=xo9cKe_Fch8 https://m.youtube.com/watch?v=xo9cKe_Fch8

ClumsyPilot 5y ago

"the optimal strategy for a firm is to simply do what every one else is doing" Such a convenient worldview, conpwtition doesn't exist, banks did nothing wrong prior to 2008, etc.

Dracophoenix 5y ago
Competition requires players to remain in the game. No one is required to make a profit-losing decision realized or unrealized. If they do make such a decision, they're one step closer to going out of business. Survival is an incentive to taking the correct actions. In an iterative prisoner's dilemma, the optimal solution is most often tit-for-tat or some variation of it. It's logical for one firm to do the same as another until it can obtain a strong hold on a profit-making activity that gives it more degrees of freedom with regards to its strategies. At that point a firm can move from merely surviving to experimentation or it can continue to milk the opportunity for all its worth. Your cartel argument requires more than sameness of strategy. It requires motive and direct action towards achieving a forced equilibrium (e.g. willfully punishing other market players in concert to dissuade the use of alternative profit-making strategies). I never brought up banks. What do they and the 2008 recession have to do with online stores and 30% cuts in 2021?
- ClumsyPilot 5y ago
  "direct action towards achieving a forced equilibrium" Do you expect the head of Apple and Google to sign a public document "hereby we form an illegal cartel"? At a minimum the competition and market authority should take an interest as to why there is no competition. If they botheresld to investigate, maybe we would actually find out if there is any wrongdoing.
  - Dracophoenix 5y ago
    No. But I don't take a 30% cut as an indication of cartel-building when it has existed since Jobs first announced the App store in 2008 [1] and was done at a time where the Walmarts and Best Buys of the world charged 70% if not more. Quite recently Apple sought fit to reduce it's revenue share to 15% after the first year on the store store. Google has done the same. I wouldn't call putting more money in the pockets of developers a lack of competition. [1]https://m.youtube.com/watch?v=xo9cKe_Fch8 https://m.youtube.com/watch?v=xo9cKe_Fch8