Collusion in experimental Bertrand duopolies with convex costs: The role of cost asymmetry

Action Revision, Information and Collusion in an Experimental Duopoly Market

“…In this static model where firms decide simultaneously, the Nash equilibrium play implies A standard measure of collusion consists in measuring the extent to which firms manage to increase their profits above the Nash equilibrium profits and come closer to cartel profits (Holt (1995), Argenton and Müller (2012)). The collusion index (θ) is defined as follows:…”

“…This integer is drawn from a uniform distribution over [1,25]. If the integer drawn is 1, then an "event" occurs.…”

“…1 Although production is made at the end, there are several factors that might influence the final quantity of output produced. Demand and cost uncertainty, information about competitor's planned production, capacity constraints and other reasons might make the final choice of production different from the initial plans.…”

Hunting Unicorns? Experimental Evidence on Predatory Pricing Policies

“…Boone et al (2012), who find prices close to the marginal cost of the less e cient firm, while other experimental studies on Bertrand oligopolies with asymmetric costs find prices above the Nash equilibrium (Dugar and Mitra, 2016;Argenton and Müller, 2012). An important di erence between our design and these studies is that, in our case, the entrant faces fixed costs.…”

The Relative Efficacy of Price Announcements and Express Communication for Collusion: Experimental Findings

“…5. Compared to when firms are symmetric, asymmetric costs result in lower prices (Mason et al, 1992;Mason and Phillips, 1997;Fonseca and Normann, 2008;Dugar and Mitra, 2009;Argenton and Müller, 2012).…”