Information Disclosure and Welfare in Housing Markets: A Search-Theoretic Framework with Endogenous Participation and Broker Exit

Chihiro Shimizu

No DP26-4, RCESR Discussion Paper Series from Research Center for Economic and Social Risks, Institute of Economic Research, Hitotsubashi University

Abstract: We develop a search-and-matching model of the housing market with a disclosure parameter θ governing price estimation precision, matching probability, and market participation. Transactions occur when the bid-ask gap falls within a fixed negotiation band; higher disclosure compresses the gap distribution. Model-implied welfare losses are decomposed into nine components. Disciplined by Japanese and UK institutional moments, total losses are 39.0% versus 8.4% of imputed rent. Reduced-form regressions using Japanese prefectural panel data are consistent with the model's two central predictions: higher disclosure coverage is associated with shorter time-on-market and lower price dispersion, with magnitudes close to the model-implied elasticities. Monte Carlo simulations indicate that welfare gains are positive in all simulated draws under the perturbation design. An online appendix develops a dynamic extension exploring broker exit, market collapse, and the akiya crisis.

Keywords: Information disclosure; search and matching; housing mismatch; market participation; broker viability (search for similar items in EconPapers)
JEL-codes: D83 D91 G51 R21 R23 R31 (search for similar items in EconPapers)
Pages: 89 pages
Date: 2026-03
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