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dc.contributor.authorAUSTER, Sarah
dc.contributor.authorGOTTARDI, Piero
dc.date.accessioned2016-02-02T15:39:51Z
dc.date.available2016-02-02T15:39:51Z
dc.date.issued2015
dc.identifier.issn1725-6704
dc.identifier.urihttps://hdl.handle.net/1814/38811
dc.description.abstractWe study the competitive equilibria in a market with adverse selection and search frictions. Uninformed buyers post general direct mechanisms and informed sellers choose where to direct their search. We demonstrate that there exists a unique equilibrium allocation and characterize its properties: all buyers post the same mechanism and a low quality object is traded whenever such object is present in a meeting. Sellers are thus pooled at the search stage and screened at the mechanism stage. If adverse selection is sufficiently severe, this equilibrium is constrained inefficient. Furthermore, the properties of the equilibrium differ starkly from the case where meetings are restricted to be bilateral, in which case in equilibrium sellers sort across different mechanisms at the search stage. Compared to such sorting equilibria, our equilibrium yields a higher surplus for most, but not all, parameter specifications.en
dc.format.mimetypeapplication/pdfen
dc.language.isoenen
dc.relation.ispartofseriesEUI ECOen
dc.relation.ispartofseries2016/01en
dc.rightsinfo:eu-repo/semantics/openAccessen
dc.titleCompeting mechanisms in markets for lemonsen
dc.typeWorking Paperen


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