Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/173041
Authors: 
García, Daniel
Year of Publication: 
2017
Series/Report no.: 
CESifo Working Paper 6765
Abstract: 
We study markets for perishable goods with search frictions. Sellers have a single unit of a good and post prices in every period. Buyers engage in costly search to observe prices and match values. In equilibrium trade starts endogenously and the volume of trade increases over time. Under mild conditions, prices decrease at increasing rates over time. We derive the gains from trade in equilibrium as well as their distribution, and fully characterize the equilibrium for a class of demand functions in markets with evenly matched buyers and sellers. We finally discuss implications for market design, including cancellation policies.
Subjects: 
consumer search
dynamic pricing
sharing economy
JEL: 
D11
D83
L13
Document Type: 
Working Paper

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