Does information about competitors' actions increase or decrease competition in experimental oligopoly markets?

Steffen Huck, Hans-Theo Normann and Jörg Oechssler

Industrial Organization from University Library of Munich, Germany

Abstract: This paper investigates the impact of information about rivals' actions on the competitiveness of experimental oligopoly markets. We compare two treatments: in one, firms are informed about their rivals' actions and profits. In the other, firms are only given some aggregate information about their rivals' actions (aggregate quantities, average price). We find that in markets where goods are strategic substitutes (Cournot) the first, full information treatment leads to a significantly higher degree of competition. This is in contrast to conventional wisdom in IO. However, in markets with strategic complements (Bertrand), we find no significant difference between the two treatments.

JEL-codes: C72 C92 L13 (search for similar items in EconPapers)
Date: 1998-03-25
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Citations: View citations in EconPapers (12)

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Journal Article: Does information about competitors' actions increase or decrease competition in experimental oligopoly markets? (2000)
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Persistent link: https://EconPapers.repec.org/RePEc:wpa:wuwpio:9803004

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