Forcing Cooperation in a Prisoner’s Dilemma
How to Force Cooperation in a Prisoner’s Dilemma?
Written by Jason Gordon
Updated at March 27th, 2023
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How to Force Cooperation in a Prisoner’s Dilemma?
The way out of a prisoner’s dilemma is to find a way to penalize those who do not cooperate.
Perhaps the easiest approach for colluding oligopolists, as you might imagine, would be to sign a contract with each other that they will hold output low and keep prices high.
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- Substitution Effect
- Imperfect Competition
- Market Power
- Price Takers
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