Collusion through price ceilings? In search of a focal-point effect

Transcription

1 Collusion through price ceilings? In search of a focal-point effect Dirk Engelmann, Wieland Müllerz To cite this version: Dirk Engelmann, Wieland Müllerz. Collusion through price ceilings? In search of a focalpoint effect. Journal of Economic Behavior and Organization, Elsevier,, (), pp.1. <.1/j.jebo..0.00>. <peer-0> HAL Id: peer-0 Submitted on Jul 1 HAL is a multi-disciplinary open access archive for the deposit and dissemination of scientific research documents, whether they are published or not. The documents may come from teaching and research institutions in France or abroad, or from public or private research centers. L archive ouverte pluridisciplinaire HAL, est destinée au dépôt et à la diffusion de documents scientifiques de niveau recherche, publiés ou non, émanant des établissements d enseignement et de recherche français ou étrangers, des laboratoires publics ou privés.

2 Title: Collusion through price ceilings? In search of a focal-point effect Authors: Dirk Engelmann, Wieland Müllerz PII: S01-1()000- DOI: doi:.1/j.jebo Reference: JEBO To appear in: Journal of Economic Behavior & Organization Received date: -- Revised date: -1- Accepted date: -- Please cite this article as: Engelmann, D., Müllerz, W., Collusion through price ceilings? In search of a focal-point effect, Journal of Economic Behavior and Organization (0), doi:.1/j.jebo This is a PDF file of an unedited manuscript that has been accepted for publication. As a service to our customers we are providing this early version of the manuscript. The manuscript will undergo copyediting, typesetting, and review of the resulting proof before it is published in its final form. Please note that during the production process errors may be discovered which could affect the content, and all legal disclaimers that apply to the journal pertain.

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4 *Response to Reviewers January, Dear Professor Neilson, We are grateful for the reports we received on our paper Collusion through price ceilings? In search of a focal-point effect (JEBO-D--00) by Dirk Engelmann and myself and the invitation to revise and resubmit it. We apologize for the long delay in resubmitting the paper. This delay was due to the fact that both Dirk Engelmann and myself have new affiliations and moved to new places. The revision addresses all the issues raised by the editor and the referees. In what follows we describe in detail how we responded to the editor s and the referees comments. Sincerely, Wieland Müller Page of

5 In response to the editor s comments, we did the following: We have shortened the paper to pages, mainly by briefly summarizing our analysis of the number of colluding pairs that we presented on pages 1- in the original version of the paper. The table and detailed discussion have been moved to Appendix B in the supplementary content to be published online. We moved the proof of Proposition 1 to Appendix A in the document Supplementary Content. We have changed the style of the references into proper JEBO format. In response to the comments of referee #1, we did the following: We provide the instructions of our experiments in Appendix C in the document Supplementary Content to be made available on JEBO s homepage. We have corrected the typos. In response to the comments of referee #, we did the following: As mentioned above, we have shortened the paper. We follow the referee s suggestion of explicitly acknowledging the use of undergraduate university students in the implementation subsection where we add that our subjects where (largely undergraduate) students from a wide variety of subjects. We also discuss in the introduction in more detail possible reasons why our study using student subjects may not be easily generalizable. However, we actually do believe that most arguments why firms would behave differently than our subjects make it rather less than more likely that they would use price ceilings as collusive focal points. How convincing our arguments are should in our mind be ultimately be left to the eventual readers. We also added the following footnote (footnote ) in the conclusions where we discuss possible routes for future research: Among possible alternatives for further research are to check the effect of allowing sellers to communicate, having groups instead of individuals act in the role of sellers and of using experienced subjects. Page of

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12 Price Supply and Demand Schedule Quantity Demand Cost1 Cost Supply Ceiling Page of

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16 Frequency Histogram of prices (with demand information) < 1-1- > Price Category NoCeilingInfo CeilingInfo Page 1 of

17 Frequency Histogram of prices (without demand information) < 1-1- > Price Category NoCeilingNoInfo CeilingNoInfo Page of

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19 Average price Evolution of average prices (with demand information) Period NoYes-Info YesNo-Info Page of

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31 *Research Highlights Page of