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What is Collusion in Soft-Drink Duopoly Analysis about?

This paper proposes an empirical methodology to study collusive behaviors between two firms (Coca-Cola and Pepsi) in the soft drink market from 1968 to 1986. The paper estimates demand and cost functions under different strategic assumptions, including Nash competition, Stackelberg leadership, and various forms of partial or full collusion. It uses maximum likelihood estimation and tests of non-nested hypotheses to select the best model. When applied to the soft drink duopoly, the analysis rejects non-collu

Author

Sandhya1

Language

EN