TACIT COLLUSION IN AUCTIONS AND CONDITIONS FOR ITS FACILITATION AND PREVENTION: EQUILIBRIUM SELECTION IN LABORATORY EXPERIMENTAL MARKETS

C-Tier
Journal: Economic Inquiry
Year: 2009
Volume: 47
Issue: 3
Pages: 425-448

Score contribution per author:

0.503 = (α=2.01 / 2 authors) × 0.5x C-tier

α: calibrated so average coauthorship-adjusted count equals average raw count

Abstract

The paper studies bidder behavior in simultaneous, continuous, ascending price auctions. We design and implement a “collusion incubator” environment based on a type of public, symmetrically “folded” and “item‐aligned” preferences. Tacit collusion develops quickly and reliably within the environment. Once tacit collusion developed, it proved remarkably robust to institutional changes that weakened it as an equilibrium of a game‐theoretic model. The only successful remedy was a non‐public change in the preference of participants that destroyed the symmetrically, “folded” and “item aligned” patterns of preferences, creating head‐to‐head competition between two agents reminiscent of the concept of a “maverick.”(JEL L50, L94, D43)

Technical Details

RePEc Handle
repec:bla:ecinqu:v:47:y:2009:i:3:p:425-448
Journal Field
General
Author Count
2
Added to Database
2026-01-29