Do short-term laboratory experiments provide valid descriptions of long-term economic interactions? A study of Cournot markets

Hans-Theo Normann, Till Requate () and Israel Waichman ()

No 100, DICE Discussion Papers from Heinrich Heine University Düsseldorf, Düsseldorf Institute for Competition Economics (DICE)

Abstract: One key problem regarding the external validity of laboratory experiments is their duration: while economic interactions out in the field are often lengthy processes, typical lab experiments only last for an hour or two. To address this problem for the case of both symmetric and asymmetric Cournot duopoly, we conduct internet treatments lasting more than a month. Subjects make the same number of decisions as in the short-term counterparts, but they decide once a day. We compare these treatments to corresponding standard laboratory treatments and also to short-term internet treatments lasting one hour. We do not observe differences in behavior between the short- and long-term in the symmetric treatments, and only a small difference in the asymmetric treatments. We overall conclude that behavior is not considerably different between the short- and long-term.

Keywords: internet experiment; Cournot oligopoly; long-term interactions; methodology; internet vs. laboratory experiment (search for similar items in EconPapers)
JEL-codes: C72 C93 D21 D43 L13 (search for similar items in EconPapers)
Date: 2013
New Economics Papers: this item is included in nep-com and nep-exp
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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Journal Article: Do short-term laboratory experiments provide valid descriptions of long-term economic interactions? A study of Cournot markets (2014)
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Persistent link: https://EconPapers.repec.org/RePEc:zbw:dicedp:100

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