WHEN DOES PREDATION DOMINATE COLLUSION?

• 成果类型: Article
• 署名作者: Wiseman, Thomas
• 署名单位: University of Texas System; University of Texas Austin
• 刊物名称: ECONOMETRICA
• ISSN/ISSBN: 0012-9682
• DOI: 10.3982/ECTA13121
• 发表日期: 2017
• 页码: 555-584
• 关键词: Incomplete information; stochastic games; folk theorem; price wars; entry; STABILITY; industry; POWER

摘要

I study repeated competition among oligopolists. The only novelty is that firms may go bankrupt and permanently exit: the probability that a firm survives a price war depends on its financial strength, which varies stochastically over time. Under some conditions including no entry, an anti-folk theorem holds: when firms are patient, so that strength levels change relatively quickly, every Nash equilibrium involves an immediate price war that lasts until at most one firm remains. Surprisingly, the possibility of entry may facilitate collusion, as may impatience. The model can explain some observed patterns of collusion and predation.