We provide evidence that long-term relationships between trading parties emerge endogenously in the absence of third party enforcement of contracts and are associated with a fundamental change in the nature of market interactions. Without third party enforcement, the vast majority of trades are...

This paper shows that a principal's distrust in the voluntary performanceof an agent has a negative impact on the agent's motivation to perform well.

We consider two mechanisms to procure differentiated goods: a request for quote and an English auction with bidding credits. In the request for quote, each seller submits a price and the inherent quality of his good. Then the buyer selects the seller who offers the greatest difference in quality...

This paper shows that there are serious problems with matrix inversion of firm-level demand systems. When firms sell differentiated, imperfect substitutes, matrix inversion does not control for the nature of the product when the number of firms is permitted to expand beyond duopoly. Under these...

This paper studies the role of public information in multiple-agent coordination problems underlying a variety of economic scenarios such as banking and debt crises. The impact of information on coordination in such settings rests on the interplay between two types of uncertainty that agents...

We explore the difference between explicit and tacit collusion by investigating the impact communication has in experimental markets. For Bertrand oligopolies with various numbers of firms, we compare pricing behavior with and without the possibility to communicate among firms. We find strong...

A broad nontechnical coverage of many of the developments in game theory since the 1950s is given together with some comments on important open problems and where some of the developments may take place. The nearly 90 references given serve only as a minimal guide to the many thousands of books...

This paper provides a means for properly comparing demand and inverse demand for a product when the number of firms in the analysis is expanded beyond the duopoly case. To do this, first an index for the ease of substitution was derived for inverse demand systems, and then demand systems, that...

Many economic, political and social environments can be described as contests in which agents exert costly efforts while competing over the distribution of a scarce resource. These environments have been studied using Tullock contests, all-pay auctions and rank-order tournaments. This survey...

These notes are provided to describe many of the problems encountered concerning both structure and behavior in specifying what is meant by the solution to a game of strategy in matrix or strategic form. In the short term in particular, it is often reasonable for the individual to accept as...