We study equilibrium asset market outcomes when there is heterogeneity in information about asset values among both buyers and sellers. We argue that in residential real estate markets a key source of information heterogeneity pertains to hard-toobserve characteristics of the neighborhood that are subsequently capitalized in land prices. Sellers are usually better informed about neighborhood ch...

Suppose that n buyers each want one unit and m sellers each have one or more units of a good. Sellers post prices, and then buyers choose sellers. In symmetric equilibrium, similar sellers all post one price, and buyers randomize. Hence, more or fewer buyers may arrive than a seller can accommodate. We call this frictions. We solve for prices and the endogenous matching function for finite n an...

This paper reports a laboratory experiment to study pricing and advertising behavior with costly buyer search. Sellers simultaneously post prices and may incur a cost to advertise this price. In the unique symmetric equilibrium, sellers either charge a high unadvertised price or randomize in an interval of lower advertised prices. Increases in search or advertising costs raise equilibrium price...

Despite the few studies on the illegal earnings of drug sellers, the motivating factors that cause some social actors to enter the illicit drug market as sellers remains unknown. Using pooled data from the Arrestee and Drug Abuse Monitoring Program (ADAM), I investigate how household size and composition affect illegal wages earned from illicit drug sales. My findings support existing studies o...

We consider a market in which sellers can exert an informationgathering effort to advise buyers about which of two goods best fits their needs. Sellers may steer buyers towards the higher margin good. We show that for sellers to collect and reveal information, profits on both goods must be sufficiently close to each other, i.e., lie within an implementability cone, which competition or regulati...

This paper evaluates performance of human subjects and instances of a bidding model that interact in continuous-time double auction experiments. Asks submitted by instances of the seller model (“automated sellers”) maximize the seller’s expected surplus relative to a heuristic belief function, and arrive stochastically according to an exponential distribution. Automated buyers are similar. Acro...

The thesis studies sellers’ pricing and learning behaviour in Bertrand oligopoly markets using a bounded rational approach. It consists of four chapters. Chapter 1 develops a quantal response adaptive learning model which combines sellers’ bounded rationality with adaptive belief learning in order to explain price dispersion and dynamics in laboratory Bertrand markets with perfect information. ...

I study a model of investment and sale of ideas and test its empirical implications using a novel data set from the market for original movie ideas. Consistent with the theoretical results, I find that buyers are reluctant to meet unproven sellers for early-stage ideas, which restricts sellers to either developing the ideas fully (to sell them later) or abandoning them. In contrast, experienced...