Showing 1 - 10 of 12,565
Building on the seminal paper of Ordover, Saloner and Salop (1990), I study the role of reputation building on foreclosure in laboratory experiments. In one-shot interactions, upstream firms can choose to build a reputation by revealing their price history to the current upstream competitor. In...
Persistent link: https://www.econbiz.de/10011555141
When an upstream monopolist supplies several competing downstreamfirms, it may fail to monopolize the market because it is unable to commit not to behave opportunistically. We build on previous experimental studies of this well-known commitment problem by introducing communication. Allowing the...
Persistent link: https://www.econbiz.de/10011518962
theory, vertical integration improves the upstream firm's ability to commit to restricting output to the monopoly level, as … theory, we extend the theory to allow downstream firms to have heterogeneous (rather than purely passive or symmetric) out …
Persistent link: https://www.econbiz.de/10014126754
This paper presents an experimental study of exclusive dealing with an active entrant seller. We compare three treatments, which differ in terms of the sellers' moves, and find significant differences to the incumbent seller's exclusive offer and exclusion rates. Compared to the case where the...
Persistent link: https://www.econbiz.de/10012930481
theory, the upstream firm has more difficulty commiting to supply the monopoly quantity in treatments with non … existing theory, we extend received theory by allowing downstream subjects to have heterogeneous out-of-equilibrium beliefs (a …
Persistent link: https://www.econbiz.de/10014146973
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...
Persistent link: https://www.econbiz.de/10012901437
We experimentally study the effect of information about competitors' actions on cartel stability and firms' incentives to form cartels in Cournot markets. As in previous experiments, markets become very competitive when individualized information is available and participants cannot communicate....
Persistent link: https://www.econbiz.de/10013022876
As self-learning pricing algorithms become popular, there are growing concerns among academics and regulators that algorithms could learn to collude tacitly on non-competitive prices and thereby harm competition. I study popular reinforcement learning algorithms and show that they develop...
Persistent link: https://www.econbiz.de/10012661268
Market competition can erode socially responsible behavior, suggesting that allowing collusive agreements regarding corporate social responsibility (CSR) may promote public interest objectives such as fair trade and environmental standards. We study this idea in a vertical product...
Persistent link: https://www.econbiz.de/10012872237
This paper sheds new light on the role of communication for cartel formation. Using machine learning to evaluate free-form chat communication among firms in a laboratory experiment, we identify typical communication patterns for both explicit cartel formation and indirect attempts to collude...
Persistent link: https://www.econbiz.de/10013164725