Antitrust and positional arms races

The rational explanation is that before entry occurs, the expected benefit is higher than real and opportunity costs given the existing level of salaries and competition.12 Post-entry, continuing to invest in improved performance is also perfectly rational-the expected marginal benefit of effort is, indeed, higher than the cost.13 The irrational explanation for market entry is an overestimation of one's chances to win, which is quite typical for human beings.14 From an economic standpoint, a market for positional goods presents another application of zero-sum games.15 Once individuals are in the market and relative positions are established, additional investment in positional goods is mutually offsetting because the value derived from pure positional goods comes entirely from the relative positioning.