An Equilibrium Analysis of Search and Breach of Contract
Peter Diamond () and
The Warwick Economics Research Paper Series (TWERPS) from University of Warwick, Department of Economics
The literature on markets where agents have imperfect information about their trading possibilities has been growing considerably. Many models of this literature depend fundamentally on asymmetries : either buyers or sellers set prices but not both. We, however, shall consider a symmetric model where individuals meet pairwise and negotiate contracts. Individuals find potential contracting partners in a costly, stochastic search process. The purpose of a contract is to carry out a single project. The worth of a project depends on the quality of the match between the two individuals. Our model, in fact, assumes for simplicity precisely two qualities : good (project with large output) and poor (project with small output). An individual, therefore, can be in any of these three positions : without a partner, in a poor partnership, or in a good partnership.
References: Add references at CitEc
Citations: View citations in EconPapers (1) Track citations by RSS feed
Downloads: (external link)
https://warwick.ac.uk/fac/soc/economics/research/w ... 78-1988/twerp130.pdf
Working Paper: AN EQUILIBRIUM ANALYSIS OF SEARCH AND BREACH OF CONTRACT (1978)
Working Paper: An Equilibrium Analysis of Search and Breach of Contract, I (1978)
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
Persistent link: https://EconPapers.repec.org/RePEc:wrk:warwec:130
Access Statistics for this paper
More papers in The Warwick Economics Research Paper Series (TWERPS) from University of Warwick, Department of Economics Contact information at EDIRC.
Bibliographic data for series maintained by Margaret Nash ().