A buyer wishes to purchase a good from a seller who chooses a sequence of prices over time. In each period, the buyer can also exercise an outside option such as moving onto another seller. We show there is a unique equilibrium in which the seller charges a constant price in every period equal to the monopoly price against their residual demand. This result contravenes the Coase conjecture.

This paper studies optimal auction design when the seller can affect the buyers’ valuations through an unobservable ex ante investment. The key insight is that the optimal mechanism may have the seller play a mixed investment strategy so as to create correlation between the otherwise (conditionally) independent valuations of buyers. The paper establishes conditions under which the seller can, i...

This paper presents a model of a rationally inattentive seller responding to shocks to unit input cost. The model generates price series simultaneously exhibiting all three of the following features that can be found in data. 1) Prices change frequently. 2)Responses of prices to aggregate variables are delayed. 3)Prices move back and forth between a few rigid values. Discrete pricing arises eve...

Many products and services are not sold on open platforms but on competing for-profit platforms, which charge buyers and sellers for access. What is the effect of for-profit intermediation on seller investment incentives? Since for-profit intermediaries reduce the available rents in the market, one might naively suspect that sellers have weaker investment incentives with competing for-profit pl...

This study extends the understanding of signaling in online shopping environments by evaluating website signal perceptions of online buyers. Drawing from signaling theory, this study proposes and empirically tests a model for conceptualizing the influence of website signal perceptions on perceived trust, perceived deception and purchase intentions. Experimental results support the assertions of...

In many auction problems, we consider a selfinterested seller who is allocating item(s) to bidders in exchange for payments. The highly celebrated VCG mechanism provides an auction mechanism in this case that is efficient, strategy-proof, and ex post individually rational (IR). If the seller’s goal is to maximize revenue, alternative mechanisms include the Myerson optimal auction, which maximiz...