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Bertrand colludes more than Cournot

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  • Suetens, S.

    (Tilburg University, School of Economics and Management)

  • Potters, J.J.M.

    (Tilburg University, School of Economics and Management)

Abstract

On the basis of evidence of past oligopoly experiments, we argue that there is often significantly more tacit collusion in Bertrand price-choice than in Cournot quantity-choice markets.

Suggested Citation

  • Suetens, S. & Potters, J.J.M., 2007. "Bertrand colludes more than Cournot," Other publications TiSEM 884b5bf4-2acb-4ce8-b2bf-4, Tilburg University, School of Economics and Management.
  • Handle: RePEc:tiu:tiutis:884b5bf4-2acb-4ce8-b2bf-4a601e3e5637
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    References listed on IDEAS

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    1. Huck, Steffen & Normann, Hans-Theo & Oechssler, Jorg, 2000. "Does information about competitors' actions increase or decrease competition in experimental oligopoly markets?," International Journal of Industrial Organization, Elsevier, vol. 18(1), pages 39-57, January.
    2. Jan Potters & Sigrid Suetens, 2009. "Cooperation in Experimental Games of Strategic Complements and Substitutes," Review of Economic Studies, Oxford University Press, vol. 76(3), pages 1125-1147.
    3. Rotemberg, Julio J, 1994. "Human Relations in the Workplace," Journal of Political Economy, University of Chicago Press, vol. 102(4), pages 684-717, August.
    4. Martin, Stephen, 1996. "R & D joint ventures and tacit product market collusion," European Journal of Political Economy, Elsevier, vol. 11(4), pages 733-741, April.
    5. Potters, Jan & Rockenbach, Bettina & Sadrieh, Abdolkarim & van Damme, Eric, 2004. "Collusion under yardstick competition: an experimental study," International Journal of Industrial Organization, Elsevier, vol. 22(7), pages 1017-1038, September.
    6. Hans Normann & Brian Wallace, 2004. "The Impact of the Termination Rule in Cooperation Experiments," Royal Holloway, University of London: Discussion Papers in Economics 04/11, Department of Economics, Royal Holloway University of London, revised Jul 2004.
    7. Altavilla, Carlo & Luini, Luigi & Sbriglia, Patrizia, 2006. "Social learning in market games," Journal of Economic Behavior & Organization, Elsevier, vol. 61(4), pages 632-652, December.
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    Citations

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    Cited by:

    1. Philippe Aghion & Stefan Bechtold & Lea Cassar & Holger Herz, 2018. "The Causal Effects of Competition on Innovation: Experimental Evidence," Journal of Law, Economics, and Organization, Oxford University Press, vol. 34(2), pages 162-195.
    2. Davis, Douglas, 2011. "Behavioral convergence properties of Cournot and Bertrand markets: An experimental analysis," Journal of Economic Behavior & Organization, Elsevier, vol. 80(3), pages 443-458.
    3. Jan Potters & Sigrid Suetens, 2009. "Cooperation in Experimental Games of Strategic Complements and Substitutes," Review of Economic Studies, Oxford University Press, vol. 76(3), pages 1125-1147.
    4. Brañas-Garza, Pablo & Espinosa, María Paz & Rey-Biel, Pedro, 2011. "Travelers' types," Journal of Economic Behavior & Organization, Elsevier, vol. 78(1-2), pages 25-36, April.
      • Pablo Brañas-Garza & Maréa Paz & Pedro Rey-Biel, "undated". "Travelers' Types," Working Papers 407, Barcelona Graduate School of Economics.
      • Pablo Brañas-Garza & María Paz Espinosa & Pedro Rey-Biel, 2011. "Travelers' Types," Post-Print hal-00978260, HAL.
      • Brañas Garza, Pablo & Espinosa Alejos, María Paz & Rey Biel, Pedro, 2010. "Travellers' Types," DFAEII Working Papers 2010-03, University of the Basque Country - Department of Foundations of Economic Analysis II.
    5. repec:eee:jbfina:v:87:y:2018:i:c:p:248-263 is not listed on IDEAS
    6. repec:kap:expeco:v:20:y:2017:i:4:d:10.1007_s10683-017-9517-4 is not listed on IDEAS
    7. Goodwin, David & Mestelman, Stuart, 2010. "A note comparing the capacity setting performance of the Kreps-Scheinkman duopoly model with the Cournot duopoly model in a laboratory setting," International Journal of Industrial Organization, Elsevier, vol. 28(5), pages 522-525, September.
    8. Andreas Nicklisch, 2008. "Semi-collusive advertising and pricing in experimental duopolies," Discussion Paper Series of the Max Planck Institute for Research on Collective Goods 2008_25, Max Planck Institute for Research on Collective Goods.
    9. Bosworth, Steven J. & Singer, Tania & Snower, Dennis J., 2016. "Cooperation, motivation and social balance," Journal of Economic Behavior & Organization, Elsevier, vol. 126(PB), pages 72-94.
    10. Philippe Gillen & Alexander Rasch & Achim Wambach & Peter Werner, 2016. "Bid pooling in reverse multi-unit Dutch auctions: an experimental investigation," Theory and Decision, Springer, vol. 81(4), pages 511-534, November.
    11. Hans-Theo Normann & Brian Wallace, 2012. "The impact of the termination rule on cooperation in a prisoner’s dilemma experiment," International Journal of Game Theory, Springer;Game Theory Society, vol. 41(3), pages 707-718, August.
    12. Jan Potters & Sigrid Suetens, 2013. "Oligopoly Experiments In The Current Millennium," Journal of Economic Surveys, Wiley Blackwell, vol. 27(3), pages 439-460, July.
    13. Lisa Anderson & Beth Freeborn & Jason Hulbert, 2012. "Risk Aversion and Tacit Collusion in a Bertrand Duopoly Experiment," Review of Industrial Organization, Springer;The Industrial Organization Society, vol. 40(1), pages 37-50, February.
    14. Tong Zhang & B. Brorsen, 2011. "Oligopoly firms with quantity-price strategic decisions," Journal of Economic Interaction and Coordination, Springer;Society for Economic Science with Heterogeneous Interacting Agents, vol. 6(2), pages 157-170, November.
    15. Miettinen, Topi, 2013. "Promises and conventions – An approach to pre-play agreements," Games and Economic Behavior, Elsevier, vol. 80(C), pages 68-84.
    16. repec:gam:jgames:v:9:y:2018:i:3:p:45-:d:156766 is not listed on IDEAS
    17. Minas Vlassis & Maria Varvataki, 2014. "On the Mode of Competition as a Collusive Perspective in Unionized Oligopoly," Working Papers 1408, University of Crete, Department of Economics.
    18. Werner Güth & Kirsten Häger & Oliver Kirchkamp & Joachim Schwalbach, 2016. "Testing Forbearance Experimentally: Duopolistic Competition of Conglomerate Firms," International Journal of the Economics of Business, Taylor & Francis Journals, vol. 23(1), pages 63-86, February.
    19. Lenka Fiala & Sigrid Suetens, 2017. "Transparency and cooperation in repeated dilemma games: a meta study," Experimental Economics, Springer;Economic Science Association, vol. 20(4), pages 755-771, December.
    20. repec:spr:joevec:v:28:y:2018:i:2:d:10.1007_s00191-017-0529-1 is not listed on IDEAS

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