Comment by twoodfin
What does it mean to be “the only seller left standing”? If somebody’s out there making big margins because they don’t face competition, competition is likely to emerge!
What does it mean to be “the only seller left standing”? If somebody’s out there making big margins because they don’t face competition, competition is likely to emerge!
Yeah, it is theoretically possible to have a marketplace where "predatory pricing" is an accepted though aggressive business strategy, and I'd say that we are roughly there in the US. But the original intent behind the law on the books was to make markets friendly to new entrants, even if that meant sometimes constraining what large participants were allowed to do.
Yes, but the monopoly seller has already demonstrated that they will operate at a loss until their competitors go out of business, which is a pretty big deterrent to any new market entrants. They've also demonstrated that no one will be making any money until either the monopolist or the new entrant is out of business, so who would actually launch a new business in that environment?