Template-Type: ReDIF-Paper 1.0
Series: Tinbergen Institute Discussion Papers
Creation-Date: 2022-09-21
Number: 22-067/VII
Author-Name: Arnoud V. den Boer
Author-Workplace-Name: University of Amsterdam
Author-Name: Janusz M. Meylahn
Author-Workplace-Name: University of Twente
Author-Name: Maarten Pieter Schinkel
Author-Workplace-Name: University of Amsterdam
Title: Artificial Collusion: Examining Supracompetitive Pricing by Q-learning Algorithms
Abstract: We examine recent claims that a particular Q-learning algorithm used by competitors ‘autonomously’ and systematically learns to collude, resulting in supracompetitive prices and extra profits for the firms sustained by collusive equilibria. A detailed analysis of the inner workings of this algorithm reveals that there is no immediate reason for alarm. We set out what is needed to demonstrate the existence of a colluding price algorithm that does form a threat to competition.
Classification-JEL: C63, L13, L44, K21
Keywords: keywords
File-URL: https://papers.tinbergen.nl/22067.pdf
File-Format: application/pdf
File-Size: 883.420 bytes
Handle: RePEc:tin:wpaper:20220067