Advance Production Duopolies and Posted Prices or Market-Clearing Prices
AbstractThe paper reports the results of 39 laboratory duopoly markets for which pricing institution and participant experience are treatments. Duopolies in which producers with complete information about market demand make advance-production output decisions and sell their output at a clearing price (Cournot markets) are contrasted with comparable duopolies who post prices for sale through an efficient rationing mechanism (Kreps-Scheinkman or KS markets). Inexperienced participants in KS markets have much more difficulty selecting capacities consistent with the theoretical predictions than do those in Cournot markets. With experience, the differences disappear. If trading sessions last sufficiently long, it is likely that differences will disappear with inexperienced participants.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by McMaster University in its series Department of Economics Working Papers with number 2002-07.
Length: 28 pages
Date of creation: Jul 2002
Date of revision:
Contact details of provider:
Postal: 1280 Main Street West, Hamilton, Ontario, L8S 4M4
Phone: (905) 525-9140 ext. 22765
Fax: (905) 521-8232
Web page: http://www.economics.mcmaster.ca/
More information through EDIRC
Other versions of this item:
- David Goodwin & Stuart Mestelman, 2003. "Advance Production Duopolies and Posted Prices or Market-Clearing Prices," McMaster Experimental Economics Laboratory Publications, McMaster University 2003-04, McMaster University.
- NEP-ALL-2003-03-10 (All new papers)
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Davis, Douglas D., 1999. "Advance production and Cournot outcomes: an experimental investigation," Journal of Economic Behavior & Organization, Elsevier, Elsevier, vol. 40(1), pages 59-79, September.
- Muren, Astri, 2000. "Quantity precommitment in an experimental oligopoly market," Journal of Economic Behavior & Organization, Elsevier, Elsevier, vol. 41(2), pages 147-157, February.
- Owen R. Phillips & Charles F. Mason, 1992. "Mutual Forbearance in Experimental Conglomerate Markets," RAND Journal of Economics, The RAND Corporation, vol. 23(3), pages 395-414, Autumn.
- Vital Anderhub & Werner GÃ¼th & Ulrich Kamecke & Hans-Theo Normann, 2003.
"Capacity Choices and Price Competition in Experimental Markets,"
Experimental Economics, Springer,
Springer, vol. 6(1), pages 27-52, June.
- Anderhub, Vital & Güth, Werner & Kamecke, Ulrich & Normann, Hans-Theo, 2001. "Capacity choices and price competition in experimental markets," SFB 373 Discussion Papers, Humboldt University of Berlin, Interdisciplinary Research Project 373: Quantification and Simulation of Economic Processes 2001,10, Humboldt University of Berlin, Interdisciplinary Research Project 373: Quantification and Simulation of Economic Processes.
- Anderhub, V. & Guth, W. & Kamecke, U. & Normann, H.T., 2001. "Capacity Cjoices and Price Competition in Experimental Market," Papers, Flinders of South Australia - Discipline of Economics 179, Flinders of South Australia - Discipline of Economics.
- Boccard, Nicolas & Wauthy, Xavier, 2000.
"Bertrand competition and Cournot outcomes: further results,"
Economics Letters, Elsevier,
Elsevier, vol. 68(3), pages 279-285, September.
- BOCCARD , Nicolas & WAUTHY, Xavier, . "Bertrand competition and Cournot outcomes: futher results," CORE Discussion Papers RP, UniversitÃ© catholique de Louvain, Center for Operations Research and Econometrics (CORE) -1474, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
- Mason, Charles F & Phillips, Owen R & Nowell, Clifford, 1992. "Duopoly Behavior in Asymmetric Markets: An Experimental Evaluation," The Review of Economics and Statistics, MIT Press, vol. 74(4), pages 662-70, November.
- repec:ltr:wpaper:1995.23 is not listed on IDEAS
- Yin, Xiangkang & Ng, Yew-Kwang, 1997.
"Quantity Precommitment and Bertrand Competition Yield Cournot Outcomes: A Case with Product Differentiation,"
Australian Economic Papers, Wiley Blackwell,
Wiley Blackwell, vol. 36(68), pages 14-22, June.
- Xiangkang Yin & Yew-Kwang Ng, 1995. "Quantity Precommitment and Bertrand Competition Yield Cournot Outcomes: A Case with Product Differentiation," Working Papers, School of Economics, La Trobe University 1995.23, School of Economics, La Trobe University.
- David M. Kreps & Jose A. Scheinkman, 1983. "Quantity Precommitment and Bertrand Competition Yield Cournot Outcomes," Bell Journal of Economics, The RAND Corporation, The RAND Corporation, vol. 14(2), pages 326-337, Autumn.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: ().
If references are entirely missing, you can add them using this form.