Price Wars Unleash Technological Leapfrogging, Benefiting Consumers with Lower Prices
The article shows how companies can invest in new technology to beat their competitors in price wars. By taking turns to invest, firms can stay ahead and make more money. However, this can lead to too much investment, which is not good for everyone. When firms invest at the same time, one company can become a monopoly and make all the investments, which is efficient. But there are also ways for companies to work together and invest efficiently while keeping prices low for customers.