Inspired by the behavior in repeated guessing game experiments, we study adaptive play bypopulations containing individuals that reason with different levels of cognition. Individualsplay a higher order best response to samples from the empirical data on the history of play, wherethe order of...

We study duopolistic competition in a differentiated market with firms setting prices and quantities, without explicitly imposing market clearing. Unlike the commonly adopted assumption of profit maximizing firms, we assume firm behavior to be shaped by a Darwinian dynamic: the less fitter firm...

In this paper we study the effect of information on the occurrence of intentional price wars on the equilibrium path. An episode of low prices is an intentional price war if it follows a period of high prices which was ended intentionally by one of the firms in the market (the price war leader)....

We study the impact of strategic commitment on cooperation in indefinitely repeated games ofstrategic substitutes (Cournot) and complements (Bertrand) using laboratory experiments. Overall,strategic commitment has no effect on cooperation with strategic substitutes and a negative onewith...

We show that synergies enhance bidding competition to such an extent that they are a curse rather than a blessing for the bidders; they may even induce serious bankruptcy problems.

The theory of industrial collusion generally does not distinguish between tacit and explicit collusion. We show that if tacit collusion is not sustainable, firms may still be willing and able to collude explicitly when demand is viscous, the expected antitrust penalty is limited and antitrust...

We consider a model of dynamic price competition to analyze the impact of consumer inertia on theability of firms to sustain high prices. Three main consequences are identified: (i) maintaininghigh prices does not require punishment strategies when firms are sufficiently myopic, (ii) ifbuyers...

This paper uses a dynamic stochastic model to solve for the optimal pricing policy of themusic recording companies in the presence of P2P file-sharing networks eroding their CDsales. We employ a policy iteration algorithm on a discretized state space to numericallycompute the optimal price...

We consider a model of dynamic price competition to analyze the impact of consumer inertia on the ability of firms to sustain high prices. Three main consequences are identified, all of which contrast with predictions of the standard model of collusion: (i) maintaining high prices does not...

We study duopolistic competition in a differentiated market with firms setting prices and quantities, without explicitly imposing market clearing. Unlike the commonly adopted assumption of profit maximizing firms, we assume firm behavior to be shaped by a Darwinian dynamic: the less fitter firm...