Product Information and Competition Softening

Last registered on September 21, 2026
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Pre-Trial

Trial Information

General Information

Title
Product Information and Competition Softening
RCT ID
AEARCTR-0019742
Initial registration date
September 16, 2026

Initial registration date is when the trial was registered.

It corresponds to when the registration was submitted to the Registry to be reviewed for publication.

First published
September 21, 2026, 10:47 AM EDT

First published corresponds to when the trial was first made public on the Registry after being reviewed.

Locations

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Primary Investigator

Name
Tom-Reiel Heggedal
Affiliation
BI Handelshøyskolen
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Other Primary Investigator(s)

Additional Trial Information

Status
In development
Start date
2026-09-21
End date
2027-05-31
Keywords
Lab
Additional Keywords
Consumer information; price competition; horizontal product differentiation; laboratory experiment.
JEL code(s)
C92; D43; D83.
Secondary IDs
Prior work
This trial does not extend or rely on any prior RCTs.
Abstract
How does the distribution of consumer value differences affect price competition between horizontally differentiated products? We separately vary the average absolute value difference and the concentration of the distribution near zero. Human participants act only as sellers; a computer implements the buyer's purchase. The experiment tests strategic pricing responses to these demand environments.
External Link(s)

Registration Citation

Citation
Heggedal, Tom-Reiel. 2026. "Product Information and Competition Softening." AEA RCT Registry. September 21. https://doi.org/10.1257/rct.19742-1.0
Sponsors & Partners
Experimental Details

Interventions

Intervention(s)
Participants act as sellers in repeated two-seller markets with an automated buyer. The four treatments vary (i) the mean absolute difference in consumer values and (ii) whether these differences follow a uniform distribution or are concentrated near zero. Sellers observe the treatment-specific distribution before setting prices but do not observe the realized consumer values.
Intervention Start Date
2026-09-21
Intervention End Date
2027-05-28

Primary Outcomes

Primary Outcomes (end points)
The primary outcome is the matching-group mean of the average posted price in a market, (p1 + p2)/2, over games 21–60.
Primary Outcomes (explanation)
For each market, we average the two posted prices. We then average across all markets in games 21–60 within each matching group. The first 20 games are excluded to allow for learning. Each matching group receives equal weight and supplies one independent observation.

Secondary Outcomes

Secondary Outcomes (end points)
Transaction prices, seller profits, consumer surplus, and deviations of posted prices from the treatment-specific predicted equilibrium price.
Secondary Outcomes (explanation)

Experimental Design

Experimental Design
The study uses a 2 × 2 between-subject laboratory design with four treatments. Participants remain sellers for 60 paid games and are randomly rematched after every game within fixed six-seller matching groups. In each market, two sellers simultaneously set prices and an automated buyer purchases one product based on treatment-specific consumer values.
Experimental Design Details
Not available
Randomization Method
Students sign up through Sona without knowing which experiment or treatment they will enter, so treatment assignment is determined by their choice of an unlabeled participation slot. Within each treatment, participants are randomly assigned to fixed six-seller matching groups, and the experiment software randomly rematches sellers within groups after every game.
Randomization Unit
Treatment is implemented at the matching-group level. Individual participants are assigned to fixed matching groups of six sellers, and pairings are randomized within each matching group after every game.
Was the treatment clustered?
Yes

Experiment Characteristics

Sample size: planned number of clusters
28 matching groups.
Sample size: planned number of observations
168 participants: six sellers in each of 28 matching groups.
Sample size (or number of clusters) by treatment arms
T1: 7 matching groups (42 participants); T2: 7 matching groups (42 participants); T3: 7 matching groups (42 participants); T4: 7 matching groups (42 participants).
Minimum detectable effect size for main outcomes (accounting for sample design and clustering)
Power calculations use matching-group means, seven groups per treatment, and a common standard deviation of 6 price points. Target differences are 60% of the theoretical treatment differences: 24.0, 19.2, 14.4, and 9.6 price points. The smallest target is therefore 9.6 points, or 1.6 standard deviations. In 200,000 simulations of the exact one-sided Wilcoxon tests, power for this smallest comparison is 85.69% unadjusted and 84.98% with Holm adjustment; joint power across all four comparisons is 85.34% and 84.80%, respectively.
Supporting Documents and Materials

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IRB

Institutional Review Boards (IRBs)

IRB Name
BI Ethics Review Board
IRB Approval Date
2026-05-13
IRB Approval Number
SF- 065
Analysis Plan