Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/127357
Authors: 
Duersch, Peter
Eife, Thomas
Year of Publication: 
2013
Series/Report no.: 
Discussion Paper Series, University of Heidelberg, Department of Economics 547
Abstract: 
We study how inflation and deflation affect firms' ability to cooperate in an experimental Bertrand duopoly with differentiated products. We find that there is significantly less cooperation in the treatments with inflation and deflation compared to the no-inflation treatments. The difficulties to cooperate affect prices and welfare: Depending on the market structure, inflation and deflation lead to significantly lower (real) prices and higher welfare.
Subjects: 
Bertrand Duopoly
Inflation
Experiment
Money Illusion
Persistent Identifier of the first edition: 
Document Type: 
Working Paper

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