Why parties in a cartel will cheat's Full Profile
You know what Nash equilibrium is (from the other tutorial). Now we apply it to a scenario that is fairly realistic--parties to a cartel cheating.A cartel is a group of actors that agree (sometimes illegally) to coordinate their production/pricing to maximize their collective economic profit. What we will see, however, is that this is not a "Pareto optimal" state and they will soon start producing more than agreed on.
Days of the Week:
Monday, Tuesday, Wednesday, Thursday, Friday, Saturday, Sunday
- Level of Difficulty: Beginner
- Size: One-on-One
- Instructor: Sal Khan
- Cost: Free
- Institution: Khan Academy
- Topics: Finance, Economics
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