Vol. 124 No. 7
MONOPOLIZING BY CONDITIONING
Across the economy, monopolists of all kinds are engaged in “conditional dealing.” This is the practice of unilaterally offering benefits and penalties, or bribes and threats, to induce trading partners to refrain from competing against the monopolist or from dealing with its rivals. Pharma giants offer discounts conditioned on “loyalty,” agricultural monopolists impose “exit penalties” for switching to rivals, and social networks offer[...]