Projects per year
Abstract
In many markets, sellers advertise their good with an asking price. This is a price at which the seller will take his good off the market and trade immediately, though it is understood that a buyer can submit an offer below the asking price and that this offer may be accepted if the seller receives no better offers. We construct an environment with a few simple, realistic ingredients and demonstrate that, by using an asking price, sellers both maximize their revenue and implement the efficient outcome in equilibrium. We provide a complete characterization of this equilibrium and use it to explore the implications of this pricing mechanism for transaction prices and allocations.
Original language | English |
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Pages (from-to) | 731-770 |
Journal | Theoretical Economics |
Volume | 12 |
Issue number | 2 |
Early online date | 26 May 2017 |
DOIs | |
Publication status | Published - May 2017 |
Keywords
- asking prices
- posted prices
- auctions
- competing mechanisms
- competitive search
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Dive into the research topics of 'Competing with asking prices'. Together they form a unique fingerprint.Projects
- 1 Finished
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Transparency in Procurement: The design and use of information in trading mechanisms.
1/01/16 → 31/12/18
Project: Research