The limits of competition regulation in an AI-driven market
Overview Over the past few years, businesses have increasingly turned to algorithms to automate market analysis and pricing. Pricing algorithms themselves are not new — airlines have used them since the 1980s.[1] But the widespread adoption of these tools, combined with the integration of artificial intelligence technology and access to vast amounts of consumer data, is giving these tools new capabilities. The consequence is a fundamental shift in how firms compete and collude. California recognized this problem and attempted to tackle it with AB 325, which took effect January 1, 2026. But by targeting only explicit collusion through shared pricing...


