41 research outputs found
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An experiment on energy-saving competition with socially responsible consumers: opening the black box
We present results from experimental price-setting oligopolies in which green firms undertake different levels of energy-saving investments motivated by public subsidies and demand-side advantages. We find that consumers reveal higher willingness to pay for greener sellersâ products. This observation in conjunction to the fact that greener sellers set higher prices is compatible with the use and interpretation of energy-saving behaviour as a differentiation strategy. However, sellers do not exploit the resulting advantage through sufficiently high price-cost margins, because they seem trapped into ârun to stay stillâ competition. Regarding the use of public subsidies to energy-saving sellers we uncover an undesirable crowding-out effect of consumersâ intrinsic tendency to support green manufacturers. Namely, consumers may be less willing to support a green seller whose energy-saving strategy yields a direct financial benefit. Finally, we disentangle two alternative motivations for consumerâs attractions to pro-social firms; first, the self-interested recognition of the firmâs contribution to the public and private welfare and, second, the need to compensate a firm for the cost entailed in each pro-social action. Our results show the prevalence of the former over the latter
Non-competitive markets
Among all the paradigms in economic theory, the theoretical predictions of oligopoly were the first to be examined in the laboratory. In this chapter, instead of surveying all the experiments with few sellers, we adopt a narrower definition of the term âoligopolyâ, and focus on the experiments that were directly inspired by the basic oligopolistic models of Cournot, Bertrand, Hotelling, Stackelberg, and some extensions. Most of the experiments we consider in this chapter have been run in the last three decades. This literature can be considered as a new wave of experimental works aiming at representing basic oligopolistic markets and testing their properties. The chapter is divided into independent sections referring to different parts of the oligopolistic theory, including both monopoly as well as a number of extensions of the basic models, which have been chosen with the aim of providing a representative list of the relevant experimental findings
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Adaptive behavior by single-product and multiproduct price setting firms in experimental markets
We focus on the learning dynamics in multiproduct price-setting markets, where firms use past strategies and performance to adapt to the corresponding equilibrium
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Inter-gender interaction and communication in ultimatum games
In this paper, we focus on bargaining within maleâfemale pairs, the most pervasive partnership in humankind. We analyze data from an ultimatum game played by Greek subjects. Parallel to this, we introduce a one-way communication protocol according to which the responders can send short messages to the receivers, after making their decisions. The analysis shows that gender and message effects exist and that males are more effective bargainers
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Direct and indirect effects of pathological gambling on risk attitudes
We study individual decision making in a lottery-choice task performed by three different populations: gamblers under
psychological treatment ("addicts"), gamblersâ spouses ("victims"), and people who are neither gamblers or gamblersâ spouses ("normals"). We ïŹnd that addicts are willing to take less risk than normals, but the difference is smaller as a gamblerâs time under treatment increases. The large majority of victims report themselves unwilling to take any risk at all. However, addicts in the ïŹrst year of treatment react more than other addicts to the different values of the risk-return parameter
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Risk attitude elicitation methods: do they tell similar stories?
We study risk attitudes elicited through three different procedures. We find that the classification of subjects according to each one of the procedures predicts little of a subjectâs attitude towards risk as elicited by another procedure. However, we find that the more similar two decision-making contexts are, the closer the relationship between risk attitudes elicited through them. Our results reveal that some of the previous findings on womenâs higher risk aversion could be attributed to womenâs higher sensitivity to losses and the size of the stakes
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Ultimatum salary bargaining with real effort
We report experimental results on ultimatum salary bargaining with a real task performed by employee subjects. Compared to the baseline treatment with a hypothetical task, the introduction of a real task raises offers, accepted wages and rejection rates
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Corruption and individual ethics: insights from a public procurement auction
This article proposes an auction model where two firms compete for obtaining the license for a public project and an auctioneer acting as a public official representing the political power, decides the winner of the contest. Players as firms face a social dilemma in the sense that the higher is the bribe offered, the higher would be the willingness of a pure monetary maximizer public official to give her the license. However, it implies inducing a cost of reducing all playersâ payoffs as far as our model includes an endogenous externality, which depends on bribe. All playersâ payoffs decrease with the bribe (and increase with higher quality). We find that the presence of bribe aversion in either the officialsâ or the firmsâ utility function shifts equilibrium towards more pro-social behavior. When the quality and bribe-bid strategy space
is discrete, multiple equilibria emerge including more pro-social bids than would be predicted under a continuous strategy space
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Trust and reciprocity between neighbour countries: Morocco, France and Spain
This article examines an intra- and international trust game experiment between Moroccans, French and Spanish. Before making decisions, participants knew the nationality of their partner. We find that, on average, subjects from Morocco exhibit a higher level of trust. Furthermore, they trust French more than Spanish subjects. Regarding reciprocity, subjects from Spain were the least trustworthy. Additionally, we do not observe country differences in reciprocal behaviour
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Bias and size effects of price-comparison platforms: theory and experimental evidence
We analyze the impact on consumer prices of some information characteristics of price comparison search platforms. An equilibrium model where vendors compete in prices and consumers do not observe prices, but can obtain price information through a search platform, is developed. The model generates several predictions about the impact on the price distribution of: (i) the size of the search platformâs sample, (ii) whether the search
platformâs sample is random, and (iii) the number of vendors in the market. The modelâs predictions are tested experimentally. The results confirm the predictions about (ii) and (iii), but reject the modelâs predictions about (i)