We explore the intersection of growth theory and the theory of the firm with an experiment. Economic growth is possible in our experiment when agents specialize to exploit increasing returns. We find that low opportunity costs are sufficient for Marshallian internal economies, but that...

This paper examines the relationship between product innovation and the success of price collusion using novel laboratory experiments. Average market prices in low innovation experiments are significantly higher than those in high innovation, but otherwise identical experiments. This price...

We report laboratory experiments investigating the cyclicality of profit-enhancing investment in a competitive environment. In our setting, optimal investment is counter-cyclical when investment costs fall following market downturns. However, we do not observe counter-cyclical investment....

We experimentally explore indefinitely repeated contests. Theory predicts more cooperation, in the form of lower expenditures, in indefinitely repeated contests with a longer expected time horizon, and our data support this prediction, although this result attenuates with contest experience....

We report boundary experiments testing the robustness of price convergence in double auction markets for non-durable goods in which there is extreme earnings inequality at the competitive equilibrium (CE). Following up on a conjecture by Smith (1980), we test whether the well-known equilibrating...

We test whether the length of an indefinite horizon, or that the horizon is indefinite as opposed to finite, affects cooperation in repeated 3x3 Red Queen Games. With our participant population, and our experimental program and procedures, the length of the indefinite horizon significantly...