Speculation
Speculators drive up the price of a security that has no inherent value whatsoever. Some win and some lose but in the end financial gravity takes hold and the value of the security goes to zero. This is often described as a zero-sum game. However, it is really a negative-sum game due to costs such as transaction fees and any other valueless economic activity that add to total losses.Business Models
An industry with a fundamentally broken business model that will never generate more value than it requires as an input. In some cases, businesses are able to attract investment by spending money to produce growth in an way that is impossible to scale to profit. For example, a firm produces a product for a $130 unit cost and sells it for $90 in a market where demand drops to zero at $92.Conflict
Two people striking each other until one "wins" and the other "loses" but value is only destroyed.Sustainability
Manufacturing widgets that can be sold for $1 but cause $12 in environmental damage.| Overview: Negative-Sum Game | ||
Type | ||
Definition (1) | A situation that destroys value as opposed to creating it. | |
Definition (2) | A game where total losses exceed total gains. | |
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