Online markets see prices rise as more sellers join, surprising study finds.
The number of sellers in online book markets doesn't always lead to lower prices. Prices drop significantly when the market goes from one seller to two, but then they go back up towards monopoly prices as more sellers join. This happens because with more sellers, it's harder for consumers to find the best deals, so they end up making random purchases. Sellers then don't need to lower prices to compete, so they actually raise them instead.