Is voting for a cartel a sign of cooperativeness?
type: Item
instance of: scholarly article
title: Is voting for a cartel a sign of cooperativeness?
zbMATH Open document ID: 1479.91187
author: Joris Gillet
published in: Games
publication date: 2021-11-26T00:00:00Z
review text: Summary: This paper tests the hypothesis that a (partial) reason why cartels -- collective but costly and non-binding price agreements -- lead to higher prices in a Bertrand oligopoly could be because of a selection effect: decision-makers who are willing to form price agreements are more likely to be less competitive and pick higher prices in general. To test this hypothesis we run an experiment where participants play two consecutive Bertrand pricing games: first a standard version without the opportunity to form agreements; followed by a version where participants can vote whether to have a (costly) non-binding agreement as a group to pick the highest number. We find no statistically significant difference between the numbers picked in the first game by participants who vote for and against an agreement in the second game. We do confirm that having a non-binding agreement to cooperate leads to higher numbers being picked on average. Both participants who voted for and against the agreement increase the number they pick in situations with an agreement. However, this effect is bigger for participants who voted in favour.
Mathematics Subject Classification ID: 91B54
Mathematics Subject Classification ID: 91A90
zbMATH DE Number: 7434047
zbMATH Keywords: social dilemma
zbMATH Keywords: oligopoly
zbMATH Keywords: non-binding promise
zbMATH Keywords: experimental economics
MaRDI profile type: Publication
full work available at URL: g12020048
OpenAlex ID: W3169208411
cites work: Blowing the whistle
cites work: Promises and Partnership
cites work: Promises and expectations
cites work: Why Do People Keep Their Promises? An Experimental Test of Two Explanations
cites work: Measuring beliefs in an experimental lost wallet game
DOI: 10.3390/G12020048
description: scientific article; zbMATH DE number 7434047