EMPIRICAL GAMES - THE OLIGOPOLY CASE

In this paper, I examine methods used to construct and estimate game-t heoretic models of oligopolistic interactions, and I survey some of th e empirical findings. Both static and dynamic games are covered. Stati c models provide useful summary statistics concerning the outcomes of oligopolistic interaction, whereas dynamic models attempt to capture m ore complex strategic behaviour. In the exposition of static games, I consider two empirical approaches: the first-order approach and the du al approach. When we rum to dynamics, I limit my remarks to state-spac e games - games in which actions taken in one period shift pay-offs in subsequent periods. With state-space games, all history that is pay-o ff relevant is summarized by a small set of variables - the state - an d players' strategies depend only on the state and time.