Directed Search in the Housing Market
James Albrecht,
Pieter Gautier and
Susan Vroman
No 10-005/3, Tinbergen Institute Discussion Papers from Tinbergen Institute
Abstract:
This discussion paper resulted in a publication in the 'Review of Economic Dynamics' .
In this paper, we present a directed search model of the housing market. The pricing mechanism we analyze reflects the way houses are bought and sold in the United States. Our model is consistent with the observation that houses are sometimes sold above, sometimes below and sometimes at the asking price. We consider two versions of our model. In the first version, all sellers have the same reservation value. In the second version, there are two seller types, and type is private information. For both versions, we characterize the equilibrium of the game played by buyers and sellers, and we prove efficiency. Our model offers a new way to look at the housing market from a search-theoretic perspective. In addition, we contribute to the directed search literature by considering a model in which the asking price (i) entails only limited commitment and (ii) has the potential to signal seller type.
Keywords: Directed Search; Housing (search for similar items in EconPapers)
JEL-codes: D83 R31 (search for similar items in EconPapers)
Date: 2010-01-04
References: Add references at CitEc
Citations: View citations in EconPapers (9)
Downloads: (external link)
https://papers.tinbergen.nl/10005.pdf (application/pdf)
Related works:
Journal Article: Directed Search in the Housing Market (2016) 
Working Paper: Directed Search in the Housing Market (2013)
Working Paper: Directed Search in the Housing Market (2010) 
Working Paper: Directed Search in the Housing Market (2009) 
Working Paper: Directed Search in the Housing Market (2007)
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:tin:wpaper:20100005
Access Statistics for this paper
More papers in Tinbergen Institute Discussion Papers from Tinbergen Institute Contact information at EDIRC.
Bibliographic data for series maintained by Tinbergen Office +31 (0)10-4088900 ().