Transparency and distressed sales under asymmetric information
William Fuchs,
Aniko Öry and
Andrzej Skrzypacz
Theoretical Economics, 2016, vol. 11, issue 3
Abstract:
We analyze price transparency in a dynamic market with private information and interdependent values. Uninformed buyers compete inter- and intra-temporarily for a good sold by an informed seller suffering a liquidity shock. We contrast public versus private price offers. With two opportunities to trade, all equilibria with private offers have more trade than any equilibrium with public offers; under some additional conditions, we show Pareto-dominance of the private-offers equilibria. If a failure to trade by the deadline results in an efficiency loss, public offers can induce a market breakdown before the deadline, while trade never stops with private offers.
Keywords: Adverse selection; transparency; distress; market design; volume (search for similar items in EconPapers)
JEL-codes: D82 G14 G18 (search for similar items in EconPapers)
Date: 2016-09-13
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (17)
Downloads: (external link)
http://econtheory.org/ojs/index.php/te/article/viewFile/20161103/16186/487 (application/pdf)
Related works:
Working Paper: Transparency and Distressed Sales under Asymmetric Information (2015) 
Working Paper: Transparency and Distressed Sales under Asymmetric Information (2015) 
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:the:publsh:2237
Access Statistics for this article
Theoretical Economics is currently edited by Federico Echenique, Mira Frick, Pablo Kurlat, Juuso Toikka, Rakesh Vohra
More articles in Theoretical Economics from Econometric Society
Bibliographic data for series maintained by Martin J. Osborne ().