Comparison of Auctions and Posted Prices in a Finite Random Matching Model - 10.1628/0932456032954783 - Mohr Siebeck
Economics

Klaus Kultti

Comparison of Auctions and Posted Prices in a Finite Random Matching Model

Volume 159 () / Issue 3, pp. 457-467 (11)

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I determine the steady state equilibrium in a random matching model with a finite number of buyers and sellers. Two trading mechanisms, namely, auctions and posted prices are compared. Auctions depict a situation where the sellers are unable to commit to a reserve price, whereas posted prices depict a situation where the sellers commit to a publicly announced price. In the corresponding infinite agent model the two mechanisms are equivalent, while in the finite case posted prices are preferred by sellers and auctions by buyers.

Transition: The Resurgence of Barter.
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Klaus Kultti No current data available.

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Transition: The Resurgence of Barter.