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Based on your analysis in the previous parts of this problem, is cooperation more likely in this case when the firms use the grim trigger
Based on your analysis in the previous parts of this problem, is cooperation more likely in this case when the firms use the grim trigger strategy or the tit-for-tat strategy? Tacit Collusion (Part d) Based on your analysis in the previous parts of this problem, is cooperation more likely in this case when the firms use the grim trigger strategy or the tit-for-tat strategy? Neither strategy will sustain cooperation, as both are vulnerable to deviations at any non-trivial discount rate. Grim Trigger is more likely to sustain cooperation because it signals a firm commitment to maintaining high prices, which in theory could deter competitors from initiating a price war. Tit-for-Tat is more likely to sustain cooperation, because it requires a lower discount factor for cooperation to be sustainable, making it more robust in environments with higher discounting of future profits. Both strategies are equally likely to sustain cooperation, since they both ensure compliance through reciprocal strategies
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