Price umbrella explained

A price umbrella, also known as the umbrella effect, is a pricing effect often created by a dominant company, in which competing firms can find buyers as long as they set their price at or below the level of the dominant one.^{[1] [2]} This may not apply if the competing firm's products are inferior.

Cartels can generate a price umbrella effect, enabling less efficient rivals to charge higher prices than they might otherwise be able to.^{[3] [4]}

See also

• Pricing

Notes and References

1. Web site: The Reason for the iPad Mini. Ryan Jones. July 18, 2012. 2012-08-15.
2. Web site: Apple Will Sell A Smaller iPad Or Be Disrupted From The Bottom Up By Google's Nexus 7. Anthony Wing Kosner. Forbes. 2012-07-22. 2012-08-15.
3. Web site: Using Competition Policy to Promote International Competitiveness. William J. Kolasky. U.S. Depathement of Justice. November 14, 2002. 2012-08-15.
4. Web site: Margin squeeze, entry, and "umbrella effect". Philippe Choné1 . Bruno Komly . Valérie Meunier . CREST. July 15, 2010. 2012-08-15.