Why Is Intermediating Houses So Difficult? Evidence from iBuyers

Greg Buchak, Gregor Matvos, Tomasz Piskorski and Amit Seru

Journal of Political Economy, 2026, vol. 134, issue 10, 3193 - 3251

Abstract: We study frictions in dealer intermediation in durable goods markets using iBuyers, technology-driven intermediaries providing liquidity through rapid algorithmic transactions. iBuyers earn positive spreads, bypass slow bilateral search, but operate primarily in liquid, easy-to-value segments. We develop and calibrate a dynamic search model where intermediaries face adverse selection from imperfect valuation. Faster transactions increase liquidity but reduce information, limiting intermediation. iBuyers offer a partial solution, enabling speed with limited information loss but only where assets are homogeneous and liquid. Extending the model across durable goods highlights how valuation difficulty, liquidity, and subjective value dispersion jointly determine the scope of intermediation.

Date: 2026
References: Add references at CitEc
Citations:

Downloads: (external link)
http://dx.doi.org/10.1086/742710 (application/pdf)
http://dx.doi.org/10.1086/742710 (text/html)
Access to the online full text or PDF requires a subscription.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:ucp:jpolec:doi:10.1086/742710

Access Statistics for this article

More articles in Journal of Political Economy from University of Chicago Press
Bibliographic data for series maintained by Journals Division ().