Online Supplementary Appendix to: Dynamic Markets for Lemons: Performance, Liquidity, and Policy Intervention
نویسندگان
چکیده
منابع مشابه
Dynamic markets for lemons: Performance, liquidity, and policy intervention
Even%though%adverse%selection%pervades%markets%for%real%goods%and%financial%assets,% equilibrium%in%such%markets%is%not%well%understood.%What%are%the%properties%of%equilibrium% in%dynamic%markets%for%lemons?%What%determines%the%liquidity%of%a%good?%Which%market% structures%perform%better,%decentralized%ones,%in%which%trade%is%bilateral%and%prices%are% negotiated,%or%centralized%ones,%in%which%t...
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We study a dynamic, decentralized lemons market with one–time entry and characterize its set of non–stationary equilibria. This framework offers a theory of how a market suffering from adverse selection recovers over time endogenously; given an initial fraction of lemons, the model provides sharp predictions about how prices and the composition of assets evolve over time. Comparing economies in...
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We study the trading dynamics in an asset market where the quality of assets is private information of the owner and finding a counterparty takes time. When trading of a financial asset ceases in equilibrium as a response to an adverse shock to asset quality, a large player can resurrect the market by buying up lemons which involves assuming financial losses. The equilibrium response to such a ...
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