Competitive Search with Ex-post Opportunism

Pedro Gomis-Porqueras, Benoit Julien and Liang Wang

No 201604, Working Papers from University of Hawaii at Manoa, Department of Economics

Abstract: We consider a frictional market where buyers are uncoordinated and sellers can not commit to a per-unit price and quantity of a divisible good ex-ante. By doing so sellers can exploit their local monopoly power by adjusting prices or quantities depending on the case once the local demand is realized. We find that when sellers can adjust quantities ex-post, then there exists a unique symmetric equilibrium where the increase in the buyer-seller ratio leads to higher quantities and prices in equilibrium. When sellers post ex-ante quantities and adjust prices ex-post, a symmetric equilibrium does not exist.

Keywords: Competitive Search; Price Posting; Quantity Posting (search for similar items in EconPapers)
JEL-codes: D40 L10 (search for similar items in EconPapers)
Date: 2016-03
New Economics Papers: this item is included in nep-com and nep-mic
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

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http://www.economics.hawaii.edu/research/workingpapers/WP_16-04.pdf First version, 2016 (application/pdf)

Related works:
Journal Article: Competitive Search with Ex-post Opportunism (2018)
Working Paper: Competitive Search with Ex-post Opportunism (2016)
Working Paper: Competitive Search with Ex-post Opportunism (2016)
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