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News/Misspecified Explore-then-Exploit Leads to Supra-Competitive Prices
arxiv
PublishedMay 18, 2026 at 4:00 AM

Misspecified Explore-then-Exploit Leads to Supra-Competitive Prices

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arXiv:2605.16064v1 Announce Type: cross Abstract: We study whether simple algorithmic pricing systems can systematically produce collusive-like prices in multi-firm markets. We consider firms using an explore-then-exploit pipeline: they randomize prices during an initial exploration phase, then esti

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