This paper describes a classroom exercise that illustrates the investment incentives facing firms when technological spillovers are present. The game involves two stages in which student sellersʺ first make investment decisions then production decisions. The classroom game can be used to...

Existing models of R&D are not easily reconciled with four observable aspects of R&D: initial technologies (“ideas”) need to be developed further, only a minority of initial ideas is successfully brought to the market, production and process innovations take place simultaneously (whereby,...

We experimentally examine the effectiveness of antitrust policies against bidding rings in the English auction (EN) and the first-price sealed-bid auction (FP). We consider both traditional antitrust policy (without a leniency program) and modern antitrust policy (with a leniency program). In...

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...

We propose a quantification of the p-p plot that assigns equal weight to all distances between the respective distributions: the surface between the p-p plot and the diagonal. This surface is labelled the Harmonic Weighted Mass (HWM) index. We introduce the diagonal-deviation (d-d) plot that...

Recent laboratory experiments support the popular view that the introduction of corporate leniency programs has significantly decreased cartel activity. The design of these repeated game experiments however is such that engaging in illegal price discussions is the only way for subjects to avoid...