We study a model where retailers endogenously engage in both brand advertising to attract loyal customers as well as informational advertising, which consists of deciding whether and what price to list on a price comparison site. We derive a symmetric subgame perfect equilibrium of the model and show that endogenous branding does not eliminate equilibrium price dispersion in online markets, alt...

The directed search model (Peters, 1984) is static; its dynamic extensions typically restrict strategies, often assuming price or match commitments. We lift such restrictions to study equilibrium when search can be directed over time, without constraints and at no cost. In equilibrium trade frictions arise endogenously, and price commitments, if they do exist, are self-enforcing. In contrast to...

This paper presents a conceptual design for an agent-based bilateral residential land market. The design includes interactions between multiple buyers and sellers (household agents, developers, and rural land owners) and two local feedbacks to land value—price expectation formation based on local neighborhoods and spatial externalities. To address the methodological challenges inherent in the t...

A perplexing problem in spatial modelling—going back to Hotelling’s linear market—is whether firms will cluster together or separate themselves. Maximal differentiation is the prevailing equilibrium when travel costs are quadratic and minimal differentiation results when price competition is limited. The reality for most markets is that the force that draws firms together (maximize demand) and ...

abstract this study is an attempt to investigate the influence of targeting subsidies on price transmission pattern in iran's egg market. the targeting subsidies plan was imposed by 20 december 2010. using of daily price time series data, the study was conducted during december 2009 to october 2011. using ecm model, price transmission models were estimated for the two periods (e.g. before and a...

This paper embeds a principal-agent model of producer-processor equilibrium within a market equilibrium model of contract and cash markets to analyze the impact of contracting on the spot market for hogs. The principal-agent model incorporates both quality differentiation in the contract market and an endogenously determined cash market price to account for processorproducer relationships in eq...

We embed signaling in the classical Cournot model in which several firms sell a homogeneous good. The quality is known to all the firms, but only to some buyers. The quantity-setting firms can manipulate the price to signal quality. Because there is only one price in a market for a homogeneous good, each firm incompletely controls the price-signal through the quantity decision. We characterize ...

exogeneity and controllabillty of money is a basic assumption in neo-keynesian and monetarist analysis, as well as most contemprory economic macro-models. equilibrium path cattani & cavallo & khan model (j990)1 is employed, and pree & stienhe,2 model (j989) has been used for calculation of the real exchange rate unstability index. the results, indicate negative effects of real exchange rate dev...

The stability of the rational expectations equilibrium of a simple asset market model is studied in a situation where a group of traders learn about the relationship between the price and return on the asset using ordinary least squares estimation, and then use their estimates in predicting the return from the price. The model which they estimate is a well-specified model of the rational expect...