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Hotelling revisits the lab: equilibration in continuous and discrete time

Author

Listed:
  • Curtis Kephart

    (University of California, Santa Cruz)

  • Daniel Friedman

    (University of California, Santa Cruz)

Abstract

We investigate experimentally the impact of continuous time on a four-player Hotelling location game. The static pure strategy Nash equilibrium (NE) consists of firms paired-up at the first and third quartiles of the linear city. In a repeated simultaneous move (discrete time) treatment, we largely replicate previous findings in which subjects fail to converge to the NE. However, in asynchronous move (continuous time) treatments we see clear convergence towards the NE.

Suggested Citation

  • Curtis Kephart & Daniel Friedman, 2015. "Hotelling revisits the lab: equilibration in continuous and discrete time," Journal of the Economic Science Association, Springer;Economic Science Association, vol. 1(2), pages 132-145, December.
    • Handle: RePEc:spr:jesaex:v:1:y:2015:i:2:d:10.1007_s40881-015-0009-z
    DOI: 10.1007/s40881-015-0009-z
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    2. Zhao, Shuchen, 2021. "Taking turns in continuous time," Journal of Economic Behavior & Organization, Elsevier, vol. 191(C), pages 257-279.
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    6. Adnan M. S. Fakir & Yiwei Qian & Naveen Sunder, 2023. "Gender Differences in Preference for Non-pecuniary Benefits in the Labour Market. Experimental Evidence from an Online Freelancing Platform.," Working Paper Series 0623, Department of Economics, University of Sussex Business School.
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    More about this item

    Keywords

    Hotelling model; Laboratory experiment; Asynchronous move;
    All these keywords.

    JEL classification:

    • C73 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Stochastic and Dynamic Games; Evolutionary Games
    • C92 - Mathematical and Quantitative Methods - - Design of Experiments - - - Laboratory, Group Behavior
    • D21 - Microeconomics - - Production and Organizations - - - Firm Behavior: Theory
    • D43 - Microeconomics - - Market Structure, Pricing, and Design - - - Oligopoly and Other Forms of Market Imperfection

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