Game Theory in Action: Innovation Pressure in Competitive Markets

 

Noticing how companies launch new products and indirectly pressure competitors to respond got me thinking about the game theory of economics.

In such scenarios, when one company innovates and others don’t, they risk losing market share or relevance.
It’s a quiet but powerful game of strategy, timing, and survival.
📌 Example:
When OpenAI released ChatGPT, it reshaped the AI landscape.
Even though companies like Google and Meta may not have originally planned to launch tools like Gemini or LLaMA, the massive success of ChatGPT compelled them to respond.
Otherwise, they risked falling behind in a rapidly shifting market.
This is economic game theory in action: innovation by one player forces others to act, not necessarily by choice but by necessity.
💡 In today’s competitive landscape, innovation isn’t always about leading sometimes, it's about not being left out.