Amazon Used Secret ‘Project Nessie’ Algorithm to Raise Prices

Amazon.com used an algorithm code-named “Project Nessie” to test how much it could raise prices in a way that competitors would follow, according to redacted portions of the Federal Trade Commission’s monopoly lawsuit against the company.

The algorithm helped Amazon improve its profit on items across shopping categories, and because of the power the company has in e-commerce, led competitors to raise their prices and charge customers more, according to people familiar with the allegations in the complaint. In instances where competitors didn’t raise their prices to Amazon’s level, the...