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Information and Cost Asymmetry in Experimental Duopoly Markets

journal contribution
posted on 01.05.1997, 00:00 by Charles F. Mason, Owen R. Phillips, C. Nowell
We analyze data from experimental duopoly markets to assess the role information plays in facilitating collusion. In these markets, profitability can be common knowledge or private information. Market outputs are estimated in structures with symmetric and asymmetric costs under the two information conditions. Symmetric markets are more cooperative when profitability is common knowledge; asymmetric market outputs are unaffected by information differences. However, common knowledge in asymmetric markets increases the share of the output produced by the low-cost producer, and therefore increases industry efficiency.

History

ISO

eng

Language

English

Publisher

University of Wyoming. Libraries

Journal title

Review of Economics and Statistics

Collection

Faculty Publications - Economics

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Faculty Publications - Economics

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Exports