Cournot or Stackelberg competition? A survey on experimental evidence

Hildenbrand, Andreas (2010): Cournot or Stackelberg competition? A survey on experimental evidence.

Abstract

In this survey, I look into experimental studies on duopolistic quantity competition with homogeneous products and duopolistic price competition with heterogeneous products. The focus is on the sequence of competition. That is, I summarize and analyze experimental studies checking Cournot competition against Stackelberg competition. I find that while Stackelberg equilibrium outcomes are seldom under quantity competition, under price competition, the Stackelberg equilibrium prediction seems to be more appropriate. However, after discussing the experimental setups, I conclude that some methodological problems are present. Moreover, I make recommendations for further research.

• Item Type: MPRA Paper
• Language: English
• Keywords: Cournot competition; simultaneous competition; simultaneous play; Stackelberg competition; sequential competition; sequential play; duopoly; homogeneous products; heterogeneous products; experiemtal economics
• Subjects: L - Industrial Organization > L1 - Market Structure, Firm Strategy, and Market Performance > L13 - Oligopoly and Other Imperfect Markets; D - Microeconomics > D4 - Market Structure, Pricing, and Design > D43 - Oligopoly and Other Forms of Market Imperfection; C - Mathematical and Quantitative Methods > C7 - Game Theory and Bargaining Theory > C72 - Noncooperative Games; C - Mathematical and Quantitative Methods > C9 - Design of Experiments > C91 - Laboratory, Individual Behavior

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