Predatory pricing is a three-stage process: low prices, followed by the exit of producers who can no longer make a profit, followed by monopoly prices.
Predatory pricing is a three-stage process: low prices, followed by the exit of producers who can no longer make a profit, followed by monopoly prices.
Predatory pricing (also known as dumping) is a business tactic of temporarily lowering the prices to drive competitors out of business. When this policy is successful, and the business in question becomes a monopolist, the prices are raised above the level that would exist in a free market, thus exploiting consumers. In the US and many other countries it is illegal under the antitrust laws.
Predatory pricing is a three-stage process: low prices, followed by the exit of producers who can no longer make a profit, followed by monopoly prices.
Predatory pricing (also known as dumping) is a business tactic of temporarily lowering the prices to drive competitors out of business. When this policy is successful, and the business in question becomes a monopolist, the prices are raised above the level that would exist in a free market, thus exploiting consumers. In the US and many other countries it is illegal under the antitrust laws.