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We argue that, in a simple setting, the relation between the intensity of competition and cost-reducing investment is U-shaped. We consider a two-stage game with cost-reducing investments followed by a linear differentiated Cournot duopoly. We first show that, except for firms that are much less...
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, frictions, general equilibrium, labour markets, multi-unit auctions, oligopoly markets, and prediction markets Focuses on the … literature that has helped economists best understand how markets operate Assesses the impact of developments in theory, policy … -- Acknowledgements -- Notes -- References -- 4 OLIGOPOLY EXPERIMENTS IN THE CURRENT MILLENNIUM -- 1. Introduction -- 2. Oligopoly …
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This study provides a comprehensive picture of experimental Kreps-Scheinkman markets with capacity choice in the first stage and subsequent price competition at the second. We conduct seven different treatments of such markets, varying the number of firms, the demand rationing scheme, the...
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This study is the first to investigate the effect of demand rationing in experimental Bertrand-Edgeworth markets with fixed exogenous capacities. It is found that prices and profits are significantly higher under proportional than under efficient demand rationing. Moreover, the amount of...
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We run a market experiment where firms can choose not only their price but also whether to present comparable offers. They are faced with artificial demand from consumers who make mistakes when assessing the net value of products on the market. If some offers are comparable however, some...
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