We study the relation between the number of firms and price-cost margins under price competition with uncertainty about competitors' costs. We report an experiment in which two, three, and four identical firms repeatedly interact in this environment. In line with the theoretical prediction,...

We develop a model of Cournot oligopolists with endogenous R§D spillovers where a specific type of co-opetition is introduced. The two principle factors of R§D spillovers, namely the absorptive capacity and the information-sharing parameter, are assumed to depend positively on the percentage...

We analyze the welfare consequences of a monopolist having additional information about consumers' tastes, beyond the prior distribution; the additional information can be used to charge different prices to different segments of the market, i.e., carry out "third degree price discrimination." We...

The paper studies a model of delegated search. The distribution of search revenues is unknown to the principal and has to be elicited from the agent in order to design the optimal search policy. At the same time, the search process is unobservable, requiring search to be self-enforcing. The two...

In a market in which sellers compete by posting mechanisms, we study how the properties of the meeting technology affect the mechanism that sellers select. In general, sellers have incentive to use mechanisms that are socially efficient. In our environment, sellers achieve this by posting an...

This paper studies price dynamics in a setting in which a monopolist sells a new experience good over time to many buyers, and the seller can neither price discriminate among the buyers nor commit to a price rule. Buyers learn from their own experiences about the effectiveness of the product....

We develop a general game-theoretic framework for reasoning about strategic agents performing possibly costly computation. In this framework, many traditional game-theoretic results (such as the existence of a Nash equilibrium) no longer hold. Nevertheless, we can use the framework to provide...

We use data on professional chess tournaments to study how endogenous selection affects the relationship between age and mental productivity in a brain-intensive profession. We show that less talented players are more likely to drop out, and that the age-productivity gradient is heterogeneous by...

We consider the problem of an employer who has to choose whether to reemploy agents with a positive track record or agents who were unsuccessful. While previously successful managers are likely to be of high ability, they have also accumulated wealth and will be harder to motivate in the future....