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It's a tough sell from a mainstream gaming perspective, given the relative prices of popular consoles, which have stayed fairly static by comparison.
Therefore I believe the sustainability of high GPU prices is reliant upon proliferation of non-gaming uses.
I have a family friend that owns gas stations. He always says that gas prices have a tendency to "take the elevator up and the stairs down". There doesn't have to be explicit collusion. People that have large amounts of capital know whats best for them and are very judicious when it comes to lowering prices.
As you implied, "sticky prices can be both privately efficient and socially inefficient."
and " Private incentives produce too much price adjustment following an expansion in aggregate demand and too little price adjustment following a contraction in aggregate demand."
https://scholar.harvard.edu/files/mankiw/files/small_menu_co...
Earlier quoted context omitted.
Because it's illegal? Because it wouldn't maximize profits?
Price fixing increases profits as long as nobody undercuts you, that's the whole point
Earlier quoted context omitted.
Price fixing increases profits as long as nobody undercuts you, that's the whole point
Not always. I for one am just not upgrading at all due to costs. It would be a lot better to make $500 profit for each of the 100k people buying your product than $1000 profit for each of the 20k buying.
Time will tell if the market can longterm normalise $500+ as the entry level for beyond-basic PC graphics. It's a tough sell from a mainstream gaming perspective, given the relative prices of popular consoles, which have stayed fairly static by comparison. Therefore I believe the sustainability of high GPU prices is reliant upon proliferation of non-gaming uses.
Time will tell if the market can longterm normalise $500+ as the entry level for beyond-basic PC graphics. It's a tough sell from a mainstream gaming perspective, given the relative prices of popular consoles, which have stayed fairly static by comparison. Therefore I believe the sustainability of high GPU prices is reliant upon proliferation of non-gaming uses.
What are they? ETH 2.0 is here to stay, there is little profitability left. Deep learning? Sure maybe for some small scale companies or labs. Rendering farm? there can't be that many people who needs that, right?
I’m trying to think of a reason why the players in this market wouldn’t utilize a shortage like this to implicitly collude and fix the prices at the higher ranges until some additional competitor forces them down.
Is there really a player other than Nvidia? AMD has <20% market share. Nvidia doesn’t really have a competitor for standalone cards, especially in GPGPU.
I’m trying to think of a reason why the players in this market wouldn’t utilize a shortage like this to implicitly collude and fix the prices at the higher ranges until some additional competitor forces them down.
Because it's illegal? Because it wouldn't maximize profits?
Earlier quoted context omitted.
Because it's illegal? Because it wouldn't maximize profits?
Is _implicit_ collision illegal? I’m thinking in the game theory sense when there are two companies who look at the decision space of increasing, leaving the same, of decreasing prices. It seems pretty easy to reason about when there are two players and simultaneously likely that leaving the prices high would increase profit.
Probably not.
https://www.winston.com/en/competition-corner/antitrust-101-...
Earlier quoted context omitted.
Is _implicit_ collision illegal? I’m thinking in the game theory sense when there are two companies who look at the decision space of increasing, leaving the same, of decreasing prices. It seems pretty easy to reason about when there are two players and simultaneously likely that leaving the prices high would increase profit.
> Is _implicit_ collision illegal? Probably not. https://www.winston.com/en/competition-corner/antitrust-101-...