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Tacit Collusion in Price‐Setting Duopoly Markets: Experimental Evidence with Complements and Substitutes
Author(s) -
Anderson Lisa R.,
Freeborn Beth A.,
Holt Charles A.
Publication year - 2010
Publication title -
southern economic journal
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.762
H-Index - 58
eISSN - 2325-8012
pISSN - 0038-4038
DOI - 10.4284/sej.2010.76.3.577
Subject(s) - tacit collusion , collusion , duopoly , bertrand competition , economics , microeconomics , oligopoly , cournot competition
We study the effect of demand structure on the ability of subjects to tacitly collude on prices by considering Bertrand substitutes and Bertrand complements. We find evidence of collusion in the complements treatment, but no such evidence is found in the substitutes treatment. This finding is somewhat in contrast with a previous study that observes tacit collusion in two treatments with similar underlying demand structures but with no market framing.