EconPapers    
Economics at your fingertips  
 

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

Cédric Argenton and Wieland Müller

International Journal of Industrial Organization, 2012, vol. 30, issue 6, 508-517

Abstract: Theory, experimental studies, as well as antitrust guidelines suggest that symmetry among firms is conducive to more collusive outcomes. We test this perception in a series of experimental repeated Bertrand duopolies where firms have convex costs. We implement symmetric as well as asymmetric markets that vary in their degree of cost asymmetry among firms. We find no evidence of symmetric markets being more prone to collusion than asymmetric markets. If anything, asymmetry helps firms coordinate on higher prices and achieve higher profits.

Keywords: Bertrand competition; Convex costs; Collusion; Coordination; Experimental economics (search for similar items in EconPapers)
JEL-codes: L13 C72 C92 (search for similar items in EconPapers)
Date: 2012
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (26) Track citations by RSS feed

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S0167718712000653
Full text for ScienceDirect subscribers only

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eee:indorg:v:30:y:2012:i:6:p:508-517

DOI: 10.1016/j.ijindorg.2012.05.006

Access Statistics for this article

International Journal of Industrial Organization is currently edited by P. Bajari, B. Caillaud and N. Gandal

More articles in International Journal of Industrial Organization from Elsevier
Bibliographic data for series maintained by Nithya Sathishkumar ().

 
Page updated 2021-06-09
Handle: RePEc:eee:indorg:v:30:y:2012:i:6:p:508-517