An Experimental Investigation of Price Dispersion and Cycles

• 成果类型: Article
• 署名作者: Cason, Timothy N.; Friedman, Daniel; Hopkins, Ed
• 署名单位: Purdue University System; Purdue University; University of Essex; University of California System; University of California Santa Cruz; University of Edinburgh
• 刊物名称: JOURNAL OF POLITICAL ECONOMY
• ISSN/ISSBN: 0022-3808
• DOI: 10.1086/712445
• 发表日期: 2021
• 页码: 789-841
• 关键词: equilibrium; DYNAMICS; instability; COMPETITION; STABILITY; ECONOMICS; selection; oligopoly; MODEL; game

摘要

We report a continuous-time experiment studying the Burdett-Judd model, whose unique Nash equilibrium (NE) features dispersed prices. Adaptive dynamics predict that the NE is stable for one of our parameter sets and unstable for another. The empirical price distribution is close to the NE distribution for the stable parameter set, but for the unstable parameter set it skews toward higher prices in its NE support interval. We offer an empirical definition of price cycles in terms of changes over time in robust measures of central tendency and dispersion, by which the data exhibit persistent cycles in both treatments but larger cycles for the unstable parameters. Results are roughly similar for professional and student sellers and for limited-information treatments.