Economists have long recognized the importance of trust, but how can trust be enhanced in a marketplace? We set up a rational expectation model that allows the marketplace to target buyer trusting (via a buyer protection program) and seller trustworthiness (via penalty on cheaters) separately. We show that these two policies have opposite effects on the equilibrium level of trust: buyer protect...

This paper considers the e¤ect of linkage between bargains that a single buyer has with two suppliers of di¤erent items. The buyer’s valuation is private information but it is commonly known that one of the items is worth twice as much to the buyer as the other. Each bargain uses the extensive form of Section 5 of Fudenberg and Tirole (1983). We …nd that it is optimal for the buyer either to ba...

We consider the problem of a monopolist seller who is selling a good to a potential buyer and is privately informed about some of the good’s attributes. We focus on the case where goods with di¤erent attributes are horizontally di¤erentiated: they appeal di¤erently to di¤erent types of the buyer. Such a market is represented via a standard Hotelling (1929) model, where the seller’s and the buye...

We consider a seller who can propose any selling mechanism to a buyer. The seller’s reservation value and the buyer’s valuation can depend both on the buyer’s privatelyknown taste and on product characteristics privately-known to the seller. Product information is voluntarily and costlessly certifiable by the seller. We characterize all feasible allocations under any certifiability structure an...

a r t i c l e i n f o Keywords: Buyer–seller negotiations Status quo analysis Content analysis Co-citation analysis The main objective of this study is to provide an overview of the current status quo of negotiation research in marketing. In this context, we first conduct a quantitative analysis of existing literature on buyer–seller negotiations. Specifically, we undertake a screening of 10 hi...

This dissertation consists of three essays that explore contracts and corporate governance structure issues in the information technology (IT) industry. The first essay shows that when the information technology service being provided is critical to the buyer, it is optimal for the buyer and seller to sign flexible contracts that incorporate future renegotiations. The second essay studies contr...

The majority of recommender systems are designed to recommend items (such as movies and products) to users. We focus on the problem of recommending buyers to sellers which comes with new challenges: (1) constraints on the number of recommendations buyers are part of before they become overwhelmed, (2) constraints on the number of recommendations sellers receive within their budget, and (3) cons...

We study a bilateral trading relationship in which one agent, the seller, can make a non–recoverable investment in order to generate potential gains from trade. Afterwards, the seller makes a price offer that the buyer can either accept or reject. Economic theory predicts that if agents are selfish, neither the level of investment cost nor the buyer’s information about costs should affect the o...