Information about sellers' past behavior in the market for lemons

Research output: Contribution to journalArticle

4 Citations (Scopus)

Abstract

This paper studies the role of time-on-the-market information in dynamic trading environments under adverse selection. I consider a sequential search model in which (informed) sellers receive price offers from (uninformed) buyers and analyze both the case in which buyers receive no information about sellers' trading histories and the case in which buyers observe sellers' time-on-the-market. I analyze how the observability of time-on-the-market influences agents' trading behavior and investigate its welfare implications in both the single-seller environment and the stationary market environment.

Original languageEnglish (US)
Pages (from-to)365-399
Number of pages35
JournalJournal of Economic Theory
Volume169
DOIs
StatePublished - May 1 2017

Fingerprint

Seller
Buyers
Time on market
Market environment
Adverse selection
Market information
Sequential search
Observability
Welfare implications
Trading behavior

Keywords

  • Adverse selection
  • Sequential search
  • Time-on-the-market

ASJC Scopus subject areas

  • Economics and Econometrics

Cite this

Information about sellers' past behavior in the market for lemons. / Kim, Kyungmin.

In: Journal of Economic Theory, Vol. 169, 01.05.2017, p. 365-399.

Research output: Contribution to journalArticle

@article{3ddb3d8cd82347b8877439971aecfdc5,
title = "Information about sellers' past behavior in the market for lemons",
abstract = "This paper studies the role of time-on-the-market information in dynamic trading environments under adverse selection. I consider a sequential search model in which (informed) sellers receive price offers from (uninformed) buyers and analyze both the case in which buyers receive no information about sellers' trading histories and the case in which buyers observe sellers' time-on-the-market. I analyze how the observability of time-on-the-market influences agents' trading behavior and investigate its welfare implications in both the single-seller environment and the stationary market environment.",
keywords = "Adverse selection, Sequential search, Time-on-the-market",
author = "Kyungmin Kim",
year = "2017",
month = "5",
day = "1",
doi = "10.1016/j.jet.2017.02.012",
language = "English (US)",
volume = "169",
pages = "365--399",
journal = "Journal of Economic Theory",
issn = "0022-0531",
publisher = "Academic Press Inc.",

}

TY - JOUR

T1 - Information about sellers' past behavior in the market for lemons

AU - Kim, Kyungmin

PY - 2017/5/1

Y1 - 2017/5/1

N2 - This paper studies the role of time-on-the-market information in dynamic trading environments under adverse selection. I consider a sequential search model in which (informed) sellers receive price offers from (uninformed) buyers and analyze both the case in which buyers receive no information about sellers' trading histories and the case in which buyers observe sellers' time-on-the-market. I analyze how the observability of time-on-the-market influences agents' trading behavior and investigate its welfare implications in both the single-seller environment and the stationary market environment.

AB - This paper studies the role of time-on-the-market information in dynamic trading environments under adverse selection. I consider a sequential search model in which (informed) sellers receive price offers from (uninformed) buyers and analyze both the case in which buyers receive no information about sellers' trading histories and the case in which buyers observe sellers' time-on-the-market. I analyze how the observability of time-on-the-market influences agents' trading behavior and investigate its welfare implications in both the single-seller environment and the stationary market environment.

KW - Adverse selection

KW - Sequential search

KW - Time-on-the-market

UR - http://www.scopus.com/inward/record.url?scp=85014576506&partnerID=8YFLogxK

UR - http://www.scopus.com/inward/citedby.url?scp=85014576506&partnerID=8YFLogxK

U2 - 10.1016/j.jet.2017.02.012

DO - 10.1016/j.jet.2017.02.012

M3 - Article

VL - 169

SP - 365

EP - 399

JO - Journal of Economic Theory

JF - Journal of Economic Theory

SN - 0022-0531

ER -