Experiments and Competition Policy

by Jeroen Hinloopen, Hans-Theo Normann

Overview

Economists have begun to make much greater use of experimental methods in their research. The award of the Nobel Prize in 2002 to Vernon Smith confirmed that the use of such methods is now seen as an important and credible part of the economist's toolkit. In Experiments and Competition Policy, leading scholars in the field of experimental economics survey the use of experimental methods and show how they can help us to understand firm behaviour in relation to various forms of competition policy. Chapters are organized in terms of the main fields of competition policy - collusion, abusive practices and mergers - and there is also a separate section dealing with auctions and procurement. Written in a clear and non-technical style, this volume is an excellent introduction to what the increasingly important field of experimental economics can bring to the theory and practice of competition policy.

Product Details

ISBN-13:	9780521493420
Publisher:	Cambridge University Press
Publication date:	03/12/2009
Pages:	330
Product dimensions:	5.90(w) x 9.00(h) x 1.00(d)

About the Author

Jeroen Hinloopen is Professor of Industrial Organization at the University of Amsterdam and at the Catholic University of Leuven. He is also Research Fellow of the Tinbergen Institute, a member of the editorial board of the Review of Industrial Organization, an ENCORE fellow, and a fellow of the Amsterdam Centre for Law and Economics.

Hans-Theo Normann is Professor of Economics at Royal Holloway, University of London. He is also Senior Research Fellow at the Max-Planck Institute for Research on Collective Goods in Bonn and a fellow at ENCORE.

Table of Contents

1. Introduction Jeroen Hinloopen and Hans-Theo Normann; Part I: 2. Experimental results on collusion: the role of information and communication Marco A. Haan, Lambert Schoonbeek and Barbara M. Winkel; 3. Transparency about past, present and future conduct: experimental evidence on the impact on competitiveness J. Potters; 4. Collusion in growing and shrinking markets: experimental evidence from experimental duopolies Klaus Abbink and Jordi Brandts; 5. The effect of price ceilings in experimental posted-offer markets Hans-Theo Normann and Dirk Engelmann; Part II: 6. Experiments on abuse of a dominant position Eric van Damme, L. Hancher, Pierre Larouche and Wieland Müller; 7. Buyer power Bradley Ruffle; Part III: 8. Experiments on changes in market structure and their effect on performance Lorenz Götte and Armin Schmutzler; 9. Mergers in Stackelberg markets: an experimental study Steffen Huck; Part IV: 10. Making uncompetitive auctions competitive: a survey of experiments Theo Offerman and Sandler Onderstal; 11. Investment incentives in auctions: an experiment Veronika Grimm, Friederike Mengel, Giovanna Ponti and Lari Arthur Viianto; 12. Experiments and the practice of competition policy Jeroen Hinloopen and Hans-Theo Normann; Index.

Editorial Reviews

"This is a most timely book. The European Commission has heralded in the more economic approach to competition policy. While both (game) theory and econometrics have made headway in anti-trust territory, anti-trust practice has almost totally neglected the experimental evidence. This volume aptly combines survey articles with fresh evidence directly targeting standard topics in competition policy. It is highly recommended for experimental economists, industrial organization specialists, and anti-trust lawyers." - Christoph Engel, Director of the Max-Planck-Institute for Research on Collective Goods, Bonn, and Professor of Law at the University of Bonn

"The coming of age of experimental economics is signified by the increased role it plays for policy making. Experiments and Competition Policy provides an in-depth overview of the diverse policy applications that can be studied in the laboratory, including collusion, mergers, price competition, and auction design. Hinloopen and Normann have done a superb job of collecting a broad array of frontier research. This work should prove a useful reference for academicians and practitioners for years to come." - Jacob K. Goeree, Professor of Economics and Director of the Caltech Social Science Experimental Laboratory (SSEL), Caltech

"This review of experimental economics is straightforward and accessible to less technical readers, but the concepts require prior exposure to game theory and formal price theory.... The book is recommended as an addition to the literature on antitrust policy and experimental game theory, or as a second reading to supplement a core text in industrial organization.... Recommended." - Choice

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