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There's no economic motivation to compete. The motivation is to raise prices slightly, wait for the other two companies to follow suit as a signal, then to rais
by pessimizer 2y ago
There's no economic motivation to compete. The motivation is to raise prices slightly, wait for the other two companies to follow suit as a signal, then to raise prices again. If you raise and someone doesn't follow, backtrack to the previous level. This is assuming that they don't just have a meeting and set prices over drinks.
- creer 2y agoRight. There are two possible very different strategies - even illegal collusion. There is no reason to compete aggressively until one of the "several" chooses to break ranks and do so. And if the one that breaks ranks is tiny, that might still not be enough reason for the others. Since there is a good chance they will just fail.