Imitation and Belief Learning in an Oligopoly Experiment

We examine the force of three types of behavioral dynamics in quantity-setting triopoly experiments: <OL> <LI>mimicking the successful firm, <LI>following the exemplary firm, and <LI>belief learning. </OL> Theoretically, these three rules of dynamic conduct lead to the competitive, the collusive, and the Cournot-Nash outcome, respectively. In the experiment we employ three information treatments. Each of these treatments is hypothesized to be conducive to the force of one of the three dynamic rules. To a large extent, the results are consistent with the hypothesized relationships between treatments, dynamic rules, and outcomes.