Cooperation without Coordination: Signaling, Types and Tacit Collusion in Laboratory Oligopolies

Douglas Davis, Oleg Korenok and Robert Reilly

No 702, Working Papers from VCU School of Business, Department of Economics

Abstract: We study the effects of price signaling activity and underlying propensities to cooperate on tacit collusion in posted offer markets. The primary experiment consists of an extensively repeated baseline sequence and a 'forecast' sequence that adds to the baseline a forecasting game that allows identification of signaling intentions. Forecast sequence results indicate that signaling intentions considerably exceed those that are counted under a standard signal measure based on previous period prices. Nevertheless, we find essentially no correlation between either measure of signal volumes and collusive efficiency. A second experiment demonstrates that underlying seller propensities to cooperate more clearly affect collusiveness.

Keywords: Experiments; Tacit Collusion; Price Signaling; Types; Experiments; Tacit Collusion; Price Signaling; Types (search for similar items in EconPapers)
JEL-codes: C9 L11 L13 (search for similar items in EconPapers)
Pages: 28 pages
Date: 2007-03, Revised 2009-09
New Economics Papers: this item is included in nep-cbe, nep-com, nep-exp and nep-mic
References: View references in EconPapers View complete reference list from CitEc
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Downloads: (external link)
http://www.people.vcu.edu/~okorenok/DKR090109.pdf Revised version, 2009 (application/pdf)

Related works:
Journal Article: Cooperation without coordination: signaling, types and tacit collusion in laboratory oligopolies (2010)
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Persistent link: https://EconPapers.repec.org/RePEc:vcu:wpaper:0702

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