Random thought sparked by some dynamics I’m thinking through for a gig. When your top 2 rivals ally, it’s an sign of your own power, so in a weird way you want to see it happen, and see if you can take on both at once. Test of strength. If you win, your dominance is deepened.
Conversation
It’s the flip side of “the enemy of my enemy is my friend” — which is only true if enemy #1 is too big to take on alone. Nobody *wants* alliances with all their inherent compromises and tradeoffs unless forced into them for survival.
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If top 3 players in a contest A, B, and C have strengths of 9, 8, and 7, then B needs a little luck to beat A, and C needs a little luck to beat B, and a lot of luck to beat A. Low incentive to ally. But if the power levels are 9, 5, and 4, B and C *have* to ally to target #1
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The dynamics are governed by the disproportionate rewards of being #1. If you’re say 51% of the market, you enjoy weird premiums. Selling costs plummet. There’s a term for this I’m forgetting… not monopoly rents, but dominance premiums.
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And it can work down the stack, with #2 being disproportionately more rewarding than #3. But the effects wear off sharply past about 3 or 4. 5+ rankings are commodity. Bronze is the last medal.
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