Transactions That Did Not Happen and Their Influence on Prices

This paper studies data from the wholesale fruit and vegetables market in Marseille. We have details of counteroffers to the prices that were proposed by the seller even when no transaction took place. With a simple theoretical model we analyse the evolution of prices during the day and in particular the relation between the final price struck and the proposals of the two parties. Periods with no buyer refusals, of offers or bargaining with no transaction will ∗A first version of this paper was presented at the First World Congress of the Game Theory Society in Bilbao. Helpful comments from the participants there and from Alessandra Casella, Veronika Grimm, Sylvie Thoron and Jorgen Weibull are gratefully acknowledged. Financial support from the Deutsche Forschungsgemeinschaft, SFB 373 is gratefully acknowledged.