All Rights Reserved
AccessEcon LLC 2006, 2008.
Powered by MinhViet JSC
ralph lauren polo

 
Amy Moore and Michael Taylor
 
''Non-binding signals: are they effective or ineffectual?''
( 2008, Vol. 3 No.53 )
 
 
Companies often send non-binding messages to their competitors, to consumers, to channel members and to various other recipients. When such messages are in the form of price signals, they tend to make antitrust authorities uneasy since it is widely believed that price signaling can and does serve as a collusion facilitating mechanism. We conducted experimental posted-offer markets with multiple competitive equilibria, and found that contrary to expectations, markets in which sellers could engage in cheap talk had lower contract prices than markets without cheap talk opportunities.
 
 
Keywords: posted-offer markets
JEL: C9 - Design of Experiments: General
 
Manuscript Received : Aug 25 2008 Manuscript Accepted : Aug 31 2008

  This abstract has been downloaded 355 times                The Full PDF of this paper has been downloaded 87709 times