This paper analyzes the impact vertical integration has on upstream collusion when the price of the input is linear. As a first step, the paper derives the collusive equilibrium that requires the lowest discount factor in the infinitely repeated game when one firm is vertically integrated. It...

We contrast a standard deterministic signaling game with one where the signal-generating mechanism is stochastic. With stochastic signals a unique equilibrium emerges that involves separation and has intuitive comparative-static properties as the degree of signaling depends on the prior type...

We use a public-good experiment to analyze behavior in a decentralized asymmetric punishment institution. The institution is asymmetric in the sense that players differ in the effectiveness of their punishment. At the aggregate level, we observe remarkable similarities between outcomes in...

We report results of a series of experiments designed to test the stability of the best reply process. With linear demand and cost functions, the process is stable if and only if there are less than three firms in the market. However, we find no experimental evidence of such instability in a...

This paper investigates the impact of information about rivals' actions on the competitiveness of experimental oligopoly markets. We compare two treatments: in one, firms are informed about their rivals' actions and profits. In the other, firms are only given some aggregate information about...

In this paper, we assess the scope and the specific contribution of laboratory experiments for economic policy making. We review experiments which have addressed a specific problem, institution, mechanism design or tool relevant in economic policy. We have two research questions. What type of...