They're not competing to win so much as just playing a game, the unacknowledged objective of which is to keep the esteem of the other players. The players in many competitions conform to various unwritten rules of acceptable behaviour. You keep the esteem of the other players by conforming. Economists are great believers in the virtues of competition but, except perhaps in "game theory", they devote little time to studying how it works, which leaves most of them oblivious to the existence of unwritten rules.

It's only the sociologists who understand the way the much-revered goal of maximising profits has to compete with what they call "norms" of behaviour. The trouble is that the objective of most of these behavioural norms is to hold all the competitors together in a pack and stop individuals discomforting the pack by streaking out in front. To win you have to forget the pack and focus on doing something innovative to attract more customers. But this usually involves breaking some unwritten rule and thereby losing the esteem of your competitors. Many competitors just aren't prepared to pay that price.

The trick, however, is that what the pack most admires is success. So if by defying the rules you manage to win a lot more customers, thus pushing yourself ahead of the pack, the pack will grudgingly acknowledge that you're the … leader of the pack. I've come to these conclusions mainly by observing the way competition works in my own newspaper industry, but also by reading that great business/economics/sport classic of our time, Moneyball, by Michael Lewis, author of Liar's Poker.

Moneyball is the story of how Billy Bean, manager of the Oakland A's baseball team, took them to success, even though they were the second-poorest team in a completely commercial comp, where all the teams were privately owned businesses. Because they couldn't afford to bid for the best players, Bean put all his effort into selecting and training college ball players from the annual draft. And whereas all the other teams had scouts out identifying those college kids who looked like they had the makings of a great player, Bean selected rookies strictly on the basis of their statistical record of performance. For years, a handful of highly educated, baseball-loving nerds had been arguing that the traditional way of measuring baseball players' performance was all wrong and that other, more sophisticated statistical techniques were far more revealing.

All the managers and professional players laughed at the nerds' theories and told 'em they didn't know what they were talking about. Applying statistics to baseball would take all the fun and glamour out of the game. The traditional measure of batters' performance ignored any "walks" they'd scored, even though getting a walk was as good as getting a single. What was wrong with winning by walking? It wasn't macho enough.

Billy Bean was so keen to win, but so short of capital, he swallowed his pride and bought the rival theory. He stopped listening to his scouts, hired an Ivy League statistician with a laptop and selected rookies from the draft purely on their stats. Because most of them were ugly ducklings - not the kind any scout would favour - they came cheap. Bean soon greatly improved his team's annual performance in the comp. At this point, every economist would predict that Bean's competitors, seeing his success, would lose no time in copying his methods, thus robbing him of his former advantage.

But they didn't. They went for years telling themselves and each other his improved performance was just a fluke. In truth, he was defying group norms of acceptable behaviour and there was no way his competitors were prepared to risk losing the approbation of their mates by doing what he did. They didn't want to look like nerds. Note too that, contrary to the assumptions of conventional economics, here was a supposedly profit-maximising industry that had gone for decades wedded to practices that were quite inefficient.

Why? Because the competitors were on about impressing each other - by conforming to group norms - much more than about winning customers and maximising profits. They were just playing a cosy, inward-looking game. On the face of it, the newspaper industry is fighting for survival against the internet and declining circulation. But in their efforts to compete, editors and journalists focus far more on impressing their competitors than on serving their readers. The parliamentary press gallery in Canberra, for instance - the pinnacle of serious journalism in this country - is notoriously inward-looking. Its hundreds of journalists work in offices down one corridor.

They care deeply what their competitors on other papers think of their performance - with an occasional thought about what the pollies and their staffers think - but rarely give a thought to what the readers back home want or need. When one of their rivals gets a good story, they're most reluctant to abase themselves and follow it up next day for the edification of their own readers. The readers won't know their story's merely a follow-up, but all their mates in the gallery will.

They're always telling themselves (and their head offices) a rival's exclusive story was "old" or "a beat-up" - which makes them easy meat for the affected minister's press secretary, who's desperately trying to kill off the story. In theory, the editor should be the one person on a paper most obsessed by the need to stay reader-focused. In practice, editors face an enormous temptation to divert their energies to things calculated to impress rival editors and convince their troops what a great editor they are. Take the huge emphasis placed on getting exclusive stories. Now, an exclusive has intrinsic virtue if it brings to public notice important information that, government secrecy being what it is, may not otherwise have seen the light of day.

But many exclusives arise merely because a government leaks to one paper news it will release to all media outlets the following day. What's so virtuous about that? The price of such exclusives is usually to give the story a launch that's totally uncritical. My point is, I doubt that readers set nearly as much store by exclusives - even unconsciously - as editors and journalists do. Readers often don't know a story's exclusive unless you tell them. And breakfast radio can tell them the story before they pick up your paper.

What's more, I doubt if many readers set exclusives high on the list of qualities they're looking for in a paper. There are many other, less spectacular things they may be looking for, such as authoritative detail about government decisions once they progress from speculation to announced fact, service information, good writing, clear explanation, adequate backgrounding and the best commentary rather than the most commentary. But the merits of exclusives from the readers' perspective are rarely debated. Most editors and journos value them highly and that's all they care about. There's no reason you, dear reader, should care much about the quirks of journalistic competition. I quote it as an example merely because it's familiar to me and in the hope it will stimulate your thoughts about the limitations to competition in your own industry.

Point is, individuals willing to break unwritten rules and do things differently to their competitors will find plenty of room at the top. Ross Gittins is the Herald's Economics Editor.