[RickHull]

Ah, makes sense. I would still tell this story in terms of a first-mover advantage, as well as one of innovation. The point is, in a market economy, it is nearly impossible to maintain a monopoly (or oligarchy) over time. Your margins will get squeezed by new competition enticed by your margins. It seems like you got lucky in discouraging your competition, but I don't think that's a reliable tactic. A determined competitor could severely damage you and open up the market by forcing you to overbid.

[intended]

I think innovation is baked into your assumption, which doesn't necessarily hold true.

On a separate note Video games are some of the best laboratories we have to allow us to test economics - and iirc papers have been done to test and learn from these environments. I doubt I can dig any up, if I can, I will post it.

[Helianthus]

No one has pointed out that the whole business ends up increasing market efficiency--the end result was that the price for buffs stabilized over the course of the month.