Cournot or Stackelberg Competition? A Survey of Experimental Research

Hildenbrand, Andreas (2010): Cournot or Stackelberg Competition? A Survey of Experimental Research.

Abstract

In this paper, I survey experimental studies on duopolistic quantity competition with homogeneous products and duopolistic price competition with heterogeneous products. The focus is on the papers in which the sequence of competition is endogenous. Experimental studies checking Cournot competition against Stackelberg competition act as benchmarks. 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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