This paper investigates the collusive and competitive effects of algorithmic price recommendations on market outcomes. These recommendations are often non-binding and common in many markets, especially on online platforms. We develop a theoretical framework and derive two algorithms that...

This paper analyzes the role of patience in a repeated Bertrand duopoly where firms bargain over which collusive price and market share to implement. It is shown that the least patient firm's market share is not monotone in its own discount factor

This paper explores the effects of communication in market entry games experimentally. It is shown that communication increases coordination success substantially and generate inferior outcomes for consumers when market entry costs are symmetric. Such effects are not observed when costs are...

We use experiments to analyze what type of communication is most effective in achieving cooperation in a simple collusion game. Consistent with the existing literature on communication and collusion, even minimal communication leads to a short run increase in collusion. However, in a limited...

Allowing firms to cooperate in their R&D is an industrial policy which has received much attention in recent economics literature. Many of these contributions are based on the seminal analysis of d?Aspremont and Jacquemin [1988]. We provide a general version of their model which encompasses...

This paper extends a canonical, game-theoretic framework to examine the relationship between product differentiation and relaxed competition. In its theory, firms compete over an infinite-horizon and discount the future so that relaxed competition is feasible in equilibrium. However, firms face...

We examine how revenue-sharing and profit-sharing stakes affect price competition intensity under duopoly. Our analysis builds on the price competition framework introduced by Varian (1980) and accounts for fundamental asymmetries in terms of cost and consumer loyalty. A stake exists when a firm...

The experimental literature on antitrust enforcement provides robust evidence that communication plays an important role for the formation and stability of cartels. We extend these studies through a design that distinguishes between innocuous communication and communication about a cartel,...

We analyze spying out a rival’s price in a Bertrand market game with incomplete information. Spying transforms a simultaneous into a robust sequential moves game. We provide conditions for profitable espionage. The spied at firm may attempt to immunize against spying by delaying its pricing...

Effectively fighting cartels requires that cartels be discovered. Economic theory gives some behavioural patterns that are indicative of collusion and allow the distinction between collusion from competition. This paper focuses on the volatility of market shares as indicator for collusive...