Document Type
Journal article
Source Publication
Games and Economic Behavior
Publication Date
5-1-2010
Volume
68
Issue
2
First Page
748
Last Page
762
Publisher
Elsevier
Keywords
Matching and bargaining, search frictions, two-sided incomplete, information, Diamond's paradox
Abstract
We study equilibria of a dynamic matching and bargaining game (DMBG) with two-sided private information bilateral bargaining. The model is a private information replica ofMortensen and Wright (2002). There are two kinds of frictions: time discounting and explicit search costs. A simple necessary and sufficient condition on parameters for existence of a nontrivial equilibrium is obtained. This condition is the same regardless whether the information is private or not. In addition, it is shown that when the discount rate is sufficiently small, the equilibrium is unique and has the property that every meeting results in trade.
DOI
10.1016/j.geb.2009.10.005
Print ISSN
08998256
E-ISSN
10902473
Publisher Statement
Copyright © 2009 Elsevier Inc.
Access to external full text or publisher's version may require subscription.
Full-text Version
Accepted Author Manuscript
Language
English
Recommended Citation
Shneyerov, A., & Wong, A. C. L. (2010). Bilateral matching and bargaining with private information. Games and Economic Behavior, 68(2), 748-762. doi: 10.1016/j.geb.2009.10.005