Does R&D Cooperation Facilitate Price Collusion? An Experiment

    Research output: Working paperDiscussion paperOther research output

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    Abstract

    In the paper the impact of R&D cooperation on prices in experimental duopoly markets is examined.As a theoretical benchmark for the experiment, a two-stage duopoly model with an R&D stage with technological spillovers and a pricing stage is used.For two scenarios of technological spillovers (no versus complete spillovers), a treat-ment where it is possible to credibly commit to an R&D contract and a baseline treatment without binding contract possibilities, are run.Findings are that, in general, prices are between the subgame perfect Nash and the cooperative level.Further, for both spillover levels prices are higher in periods where R&D contracts are committed to, than in other periods, and to a lesser extent compared to the baseline treatments.
    Original languageEnglish
    Place of PublicationTilburg
    PublisherVakgroep CentER
    Number of pages31
    Volume2003-99
    Publication statusPublished - 2003

    Publication series

    NameCentER Discussion Paper
    Volume2003-99

    Fingerprint

    Experiment
    Collusion
    Spillover
    Technological spillovers
    Duopoly
    Benchmark
    Price level
    Scenarios
    Pricing

    Keywords

    • R&D
    • cooperation
    • duopoly
    • prices
    • spillovers

    Cite this

    Suetens, S. (2003). Does R&D Cooperation Facilitate Price Collusion? An Experiment. (CentER Discussion Paper; Vol. 2003-99). Tilburg: Vakgroep CentER.
    Suetens, S. / Does R&D Cooperation Facilitate Price Collusion? An Experiment. Tilburg : Vakgroep CentER, 2003. (CentER Discussion Paper).
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    abstract = "In the paper the impact of R&D cooperation on prices in experimental duopoly markets is examined.As a theoretical benchmark for the experiment, a two-stage duopoly model with an R&D stage with technological spillovers and a pricing stage is used.For two scenarios of technological spillovers (no versus complete spillovers), a treat-ment where it is possible to credibly commit to an R&D contract and a baseline treatment without binding contract possibilities, are run.Findings are that, in general, prices are between the subgame perfect Nash and the cooperative level.Further, for both spillover levels prices are higher in periods where R&D contracts are committed to, than in other periods, and to a lesser extent compared to the baseline treatments.",
    keywords = "R&D, cooperation, duopoly, prices, spillovers",
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    Suetens, S 2003 'Does R&D Cooperation Facilitate Price Collusion? An Experiment' CentER Discussion Paper, vol. 2003-99, Vakgroep CentER, Tilburg.

    Does R&D Cooperation Facilitate Price Collusion? An Experiment. / Suetens, S.

    Tilburg : Vakgroep CentER, 2003. (CentER Discussion Paper; Vol. 2003-99).

    Research output: Working paperDiscussion paperOther research output

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    Suetens S. Does R&D Cooperation Facilitate Price Collusion? An Experiment. Tilburg: Vakgroep CentER. 2003. (CentER Discussion Paper).