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Comment by Buttons840 | Hacker News Reader

I think of the WW1 Christmas Truce and wonder how many competitors are able to stop competing for mutual benefit. It's good when competition in war ceases, but it's not good when several "competing" companies decide to cease competition for mutual benefit. If people can do it in the highly charged situation of trench warfare, why can't companies do it to? Could a market with 10 competing companies cease competing for mutual benefit? What about 20?

Competition is not enough. It must be easy for new competitors to enter the market to ensure a nefarious trust doesn't form between companies.

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I get what you're trying to say, but the context of the Christmas truces is more complicated than just mutual benefit:

There was a huge disconnect between the leadership of the respective armies and the rank-and-file soldiers dying in the trenches. So it wasn't just "its Christmas, we shouldn't be killing each other", it was also "we have no idea why we are fighting in the first place, and our leaders think it more important that we die than that we win." It was deliberate insubordination to what the soldiers understood was pointless wasting of their lives.

I think the correct analogy is if the workers of Airbus and Boeing both struck because the two companies had both adopted new business practices in the name of business competition, that simply killed workers and passengers without providing either with any kind of competitive advantage.

Boeing and Airbus work together on the CAD standards that they use to build their products.

Ceasing competition for mutual benefit is generally illegal.

Not everything is zero sum. The important element is not whether or not it is mutually beneficial to the companies, but whether it is detrimental to some other party.

Price fixing, wage suppression, monopolizing etc are all detrimental to the customer, employees, or other businesses, but it is possible to collaborate or “cease competition” in certain areas for mutual benefit in ways that are not detrimental (and in fact, are also beneficial) to others.

If it's organized, but what if it's just an unspoken rule in the industry? The result would be an unchanging status que with little innovation.

If this were true I'd expect to see industries where innovation usually comes from new companies in the market. The existing companies have stopped trying, stopped competing, and thus you only see innovation from new companies. Do we see this pattern often?

My point is the number of competitors is less important than how easy it is for new competitors to enter.

I agree, but I'm not sure how that relates.

You said it's illegal, and I claimed it happens all the time, that's how it relates.

Sorry, I still don't quite follow. Can you give an example of companies ceasing competition for mutual benefit?

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