In auctions where a seller can post a reserve price but if the object fails to sell cannot commit never to attempt to resell it, revenue equivalence between repeated first price and second price auctions without commitment results. When the time between auctions goes to zero, seller expected revenues converge to those of a static auction with no reserve price. With many bidders, the seller equi...

A new theory of coexistence of money and higher-return assets is set out. It applies to any setting in which some trade involves an exchange of goods for assets and occurs between two people–a buyer and a seller. We show that there exists a function mapping the portfolios of the buyer and the seller to the trade that occurs such that (i) the trade is in the buyer-seller core and (ii) some peopl...

I analyze how a buyer optimally contracts with a seller who is privately informed about his information structure, i.e., his ability of acquiring private signals containing imperfect cost information. I demonstrate that the seller ranks information structures according to the order of their signal distributions in the sense of second order stochastic dominance. Optimal contracts offer sellers w...

In many negotiations, rules are soft in the sense that the seller and/or buyers may break them at some cost. When buyers have private values, we show that the cost of such opportunistic behavior (whether by the buyers or the seller) is borne entirely by the seller in equilibrium, in the form of lower revenues. Consequently, the seller is willing to pay an auctioneer to credibly commit to a mech...

We study a model of the seller of an asset who is liable for damages to buyers of the asset if, after the sale, the seller is discovered to have failed to disclose an estimate of the asset’s value that the seller knew prior to sale. The model yields some surprising predictions concerning how the seller’s disclosure decision changes with changes in the severity of this liability, and with other ...

We examine the market power of a seller who repeatedly offers upgraded versions of a product. In the case of pure monopoly, the seller also controls compatibility across versions. In the case of an entrant who offers an upgrade, the incumbent seller also controls subsequent interoperability across versions. We argue that control of compatibility and interoperability does not allow an incumbent ...

Seller reputation is recognized as an essential determinant in online C2C marketplaces, but its influence on price premium remains unknown. The majority of existing studies indicate that seller reputation is positively correlated with sales price (price premium) on eBay US, but not on Taobao China. Conversely, the strong correlation between seller reputation and sales volume found on Taobao (vo...

This paper reports on a large scale field experiment testing strategies available to a seller participating in simultaneous competitive sequential, ascending price automobile auctions. Every other week, the seller offered approximately 120 vehicles for sale in an auction environment in which several competitive sellers offered on the order of 3,000 vehicles. The experiment tested various sequen...

This article reviews experimental work on two party bargaining where a bargainer has information unavailable to the other party. The situation is one where the bargaining is on a single issue only and is distributive, (i.e., the negotiations are on the sharing or distribution of the common gains from trade). Two experimental situations are reviewed and several observations are drawn, including ...

A trusted third party (TTP) is introduced to the buyer-seller protocol to guarantee the transaction fairness in protocol. However, the TTP practically increases the cost in the buyer-seller protocol. To address this issue, we propose a novel buyer–seller watermarking protocol to eliminate the need for a TTP. By dividing the buyer’s secret key into two primary mechanisms: the buyer’s watermark, ...