A note comparing the capacity setting performance of the Kreps-Scheinkman duopoly model with the Cournot duopoly model in a laboratory setting
AbstractThe paper reports the results of 39 laboratory duopoly markets for which pricing institution and participant experience are treatments. Cournot (C) duopolies (quantity precommitment and a price determined to clear the market) are contrasted with Kreps-Scheinkman (KS) duopolies (quantity precommitment and posted prices). Inexperienced participants in KS markets have much more difficulty selecting capacities consistent with the theoretical predictions than do those in C markets. With experience, the differences disappear.
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Bibliographic InfoArticle provided by Elsevier in its journal International Journal of Industrial Organization.
Volume (Year): 28 (2010)
Issue (Month): 5 (September)
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Web page: http://www.elsevier.com/locate/inca/505551
Duopoly Laboratory experiment Quantity precommitment Posted prices Price competition Market-clearing prices Experience;
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