d not purchase electricity. The contracts involved only the companies' promises not to sell electricity to other aluminum producers, not the sale of electricity to Alcoa.
A less blatant method available for accomplishing market channel predation is the use of market channel agreements such as exclusive dealing agreements, refusals to deal, territorial restraints, and tying arrangements (Krattenmaker & Salop, 1986; Salop & Scheffman, 1983). For example, a large firm may establish a policy of selling to buyers only on contractual terms that exclude competitors from selling to the same buyers. When such tactics are pursued by several larger firms in a market, smaller competitors may be severely restricted in their access to established distribution channels.
An aggressive firm may also attempt to lower a rival's profits through price predation. In this case, a firm sets its prices low enough and for a sufficient time period to disadvantage its rivals in some way (Sheffet, 1994). Tactics can include sustained price cuts to below-cost levels, discrimina
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