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An Updated Review of Industrial Organization: Applications of Experimental Methods

Plott, Charles R. (1989) An Updated Review of Industrial Organization: Applications of Experimental Methods. In: Handbook of Industrial Organization. Vol.2. Elsevier , pp. 1109-1176. ISBN 9780444704351.

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From the very beginning laboratory experiments in economics were motivated by theories of industrial organization. The first published market experiments were those of Chamberlin (1948) who explored the behavioral characteristics of markets he described as being "purely" but not " perfectly" competitive. He thought that the principles of monopolistic competition would be more useful than the theory of competitive demand and supply in explaining the observed behavior. Hoggatt (1959) and Sauermann and Selten (1959) independently provided the first experimental evidence that the Cournot model might be a reasonably accurate description of oligopolistic behavior. Oligopoly and bilateral monopoly motivated the classic work of Fouraker and Siegel (1963) which introduced several of the experimental techniques still used today. Smith's (1962) sensitivity to the organization of the floor of the stock exchanges led him to the fundamental discovery that the law of competitive demand and supply can be observed operating in an experimental environment. The field of experimental economics has experienced substantial evolution during the intervening twenty-eight years.

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Additional Information:© 1989 Elsevier Science Publishers B. V. The general methodological discussions of this paper found in Sections 2, 6, and 7 are taken from an earlier review by the author [Plott (1982)]. At additional points, when describing the literature prior to 1980, this review also draws heavily on the earlier paper. The financial support of the National Science Foundation is gratefully acknowledged.
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Caltech Laboratory for Experimental Economics and Political ScienceUNSPECIFIED
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Official Citation:Charles R. Plott, Chapter 19 An updated review of industrial organization: Applications of experimental methods, In: Richard Schmalensee and Robert Willig, Editor(s), Handbook of Industrial Organization, Elsevier, 1989, Volume 2, Pages 1109-1176, ISSN 1573-448X, ISBN 9780444704351, (
Usage Policy:No commercial reproduction, distribution, display or performance rights in this work are provided.
ID Code:44254
Deposited On:12 Mar 2014 22:35
Last Modified:10 Nov 2021 16:49

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