Tacit Collusion in Price-Setting Duopoly Markets: Experimental Evidence
AbstractWe study the effect of demand structure on the ability of subjects to tacitly collude on prices by considering Bertrand substitutes and Bertrand complements. We find evidence of collusion in the complements treatment, but no such evidence in the substitutes treatment. This finding is somewhat in contrast with Potters and Suetens (2007) who observe tacit collusion in two treatments with similar underlying demand structures but with no market context.
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Bibliographic InfoPaper provided by Department of Economics, College of William and Mary in its series Working Papers with number 73.
Length: 18 pages
Date of creation: 10 Jul 2008
Date of revision:
collusion; Bertrand; experiment;
Find related papers by JEL classification:
- C9 - Mathematical and Quantitative Methods - - Design of Experiments
- L1 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance
This paper has been announced in the following NEP Reports:
- NEP-ALL-2008-07-14 (All new papers)
- NEP-COM-2008-07-14 (Industrial Competition)
- NEP-EXP-2008-07-14 (Experimental Economics)
- NEP-MIC-2008-07-14 (Microeconomics)
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- Lisa R. Anderson & Beth A. Freeborn & Jason P. Hulbert, 2009.
"Risk Aversion and Tacit Collusion in a Bertrand Duopoly Experiment,"
84, Department of Economics, College of William and Mary.
- Lisa Anderson & Beth Freeborn & Jason Hulbert, 2012. "Risk Aversion and Tacit Collusion in a Bertrand Duopoly Experiment," Review of Industrial Organization, Springer, vol. 40(1), pages 37-50, February.
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