As self-learning pricing algorithms become popular, there are growing concerns among academics and regulators that could learn to collude tacitly on non-competitive prices thereby harm competition. I study popular reinforcement learning show they develop collusive behavior in a simulated market environment. To derive counterfactual resembles traditional tacit collusion, conduct experiments with...

To evaluate changes to hop industry concentration and competitiveness the Herfindahl-Hirschman Index (HHI) was used. The ownership of proprietary varieties, their acreage production were compared with public varieties. Market share for each variety calculated between 2000 2020. quantity land under centralized control in U.S. due increased 2020 quantified. Assuming tacit collusion participants o...

Harrington et al. [21] introduced a general framework for modeling tacit collusion in which producing firms collectively maximize the Nash bargaining objective function, subject to incentive compatibility constraints. This work extends that collusion model to the setting of a competitive pool-based electricity market operated by an independent system operator. The extension has two features. Fi...

We analyze tacit collusion in an industry characterized by cyclical demand and long-run scale decisions; ...rms face deterministic demand cycles and choose capacity levels prior to competing in prices. Our focus is on the nature of prices. We ...nd that two types of price wars may exist. In one, collusion can involve periods of mixed strategy price wars. In the other, consistent with the Rotemb...

Extant research suggests that tacit collusion or the “golden rule” of refraining from aggressive pricing in jointly contested markets is an integral feature of the US airline industry. Our research revisits this past wisdom in the presence of airlines that pursue a distinctly different pricing strategy. Amongst airlines, Southwest and JetBlue largely practice an Everyday Low Price (EDLP) price-...

We examine learning by artificial agents in repeated play of Cournot duopoly games. Our learning model is simple and cognitively realistic. The model departs from standard reinforcement learning models, as applied to agents in games, in that it credits the agent with a form of conceptual ascent, whereby the agent is able to learn from a consideration set of strategies spanning more than one per...

Recent events involving major insurance companies and insurance brokerage firms highlight substantial incentive problems in commercial and reinsurance markets where intermediation takes place. We show that in markets with informed as well as uninformed consumers and heterogeneous risk profiles intermediation has the potential to improve social welfare. However, since intermediation reduces insu...

It has been shown in prior research that cost effectiveness in the competitive emissions permit market could be affected by tacit collusion or price manipulation when the corresponding polluting product market is oligopolistic. We analyze these cross market links using a Stackelberg model to show that under reasonable assumptions, there are no incentives to collude for lobbying prices up. Howev...