Oligopolies Gain Unfair Advantage Through Dynamic Pricing Strategies
The article explores how competition among companies changes over time. By using a model that considers costs and demand, the author shows that when companies reach a stable point in their competition, their predictions about each other's actions are negative, constant, and symmetric. These predictions also change smoothly based on factors like how quickly companies can adjust to new information. This means that in a certain type of competition, companies make consistent guesses about each other's moves that help them reach a balanced state.