Price umbrella

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.{{cite web|url=http://www.iamconcise.com/main/the-reason-for-the-ipad-mini.html|title=The Reason for the iPad Mini|author=Ryan Jones|date=July 18, 2012|access-date=2012-08-15}}{{cite web|url=https://www.forbes.com/sites/anthonykosner/2012/07/22/apple-will-sell-a-smaller-ipad-or-be-disrupted-from-the-bottom-up-by-google-and-amazon/|title=Apple Will Sell A Smaller iPad Or Be Disrupted From The Bottom Up By Google's Nexus 7|author=Anthony Wing Kosner|work=Forbes|date=2012-07-22|access-date=2012-08-15}} 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.{{cite web|url=https://www.justice.gov/atr/public/speeches/200485.pdf|title=Using Competition Policy to Promote International Competitiveness|author=William J. Kolasky|publisher=U.S. Depathement of Justice|date=November 14, 2002|access-date=2012-08-15}}{{cite web|title=Margin squeeze, entry, and "umbrella effect"|url=http://www.crest.fr/ckfinder/userfiles/files/pageperso/Squeeze_July_2010.pdf|author=Philippe Choné1 |author2=Bruno Komly |author3=Valérie Meunier |publisher=CREST|date=July 15, 2010|access-date=2012-08-15}}