Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/192318 
Authors: 
Year of Publication: 
2002
Series/Report no.: 
Discussion Papers No. 336
Publisher: 
Statistics Norway, Research Department, Oslo
Abstract: 
This paper reports on price formation in experimental markets in which a single seller trades with four buyers. Transactions occur if either a buyer accepts an offer to sell from the seller, or the seller accepts an offer to buy from a buyer. The dissemination of such offers is endogenous in that the seller determines which buyer(s) should be informed about offers to sell, whereas each buyer may broadcast his offer to buy to any of the residual buyers. Complete dissemination of offers is consistent with conventional double-auction trading rules. The result is two-fold. First, the diffusion of trading information is incomplete, in that neither the single seller nor the buyers inform all market participants about offers. Second, observed prices and the number of transactions are in line with the competitive theoretic benchmark.
Subjects: 
Experimental economics
market structure
trading information
JEL: 
C90
D42
G14
Document Type: 
Working Paper

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