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http://hdl.handle.net/10419/64548
  

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dc.contributor.authorFonseca, Miguel A.en_US
dc.contributor.authorNormann, Hans-Theoen_US
dc.date.accessioned2012-09-27en_US
dc.date.accessioned2012-09-28T12:59:37Z-
dc.date.available2012-09-28T12:59:37Z-
dc.date.issued2012en_US
dc.identifier.isbn978-3-86304-066-6en_US
dc.identifier.urihttp://hdl.handle.net/10419/64548-
dc.description.abstractWe conduct experiments testing the relationship between excess capacity and pricing in repeated Bertrand-Edgeworth duopolies and triopolies. We systematically vary the experimental markets between low excess capacity (suggesting monopoly) and no capacity constraints (suggesting perfect competition). Controlling for the number of firms, higher production capacity leads to lower prices. However, the decline in prices as industry capacity rises is less pronounced than predicted by Nash equilibrium, and a model of myopic price adjustments has greater predictive power. With higher capacities, Edgeworth-cycle behavior becomes less pronounced, causing lower prices. Evidence for tacit collusion is limited and restricted to low-capacity duopolies.en_US
dc.language.isoengen_US
dc.publisherDICE Düsseldorfen_US
dc.relation.ispartofseriesDICE Discussion Paper 67en_US
dc.subject.jelC72en_US
dc.subject.jelC90en_US
dc.subject.jelD43en_US
dc.subject.ddc330en_US
dc.subject.keywordtacit collusionen_US
dc.subject.keywordexcess capacityen_US
dc.subject.keywordEdgeworth cyclesen_US
dc.titleExcess capacity and pricing in Bertrand-Edgeworth markets: Experimental evidenceen_US
dc.typeWorking Paperen_US
dc.identifier.ppn726566926en_US
dc.rightshttp://www.econstor.eu/dspace/Nutzungsbedingungenen_US
dc.identifier.repecRePEc:zbw:dicedp:67-
Appears in Collections:DICE Discussion Paper, Düsseldorf Institute for Competition Economics (DICE)

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