TY - JOUR
T1 - A market with frictions in the matching process
T2 - An experimental study
AU - Cason, Timothy N.
AU - Noussair, Charles
PY - 2007/5
Y1 - 2007/5
N2 - We construct a laboratory market in which there is a friction in the matching between buyers and sellers. Sellers simultaneously post prices and then buyers simultaneously choose a seller. If more than one buyer chooses the same seller, the seller's single unit is randomly sold to one of them. Our results show a broad consistency with theoretical predictions, although price dispersion exists and is slow to decay. Prices also exceed the equilibrium level when there are only two sellers, and buyers' purchase probabilities are insufficiently responsive to price differences when there are two sellers.
AB - We construct a laboratory market in which there is a friction in the matching between buyers and sellers. Sellers simultaneously post prices and then buyers simultaneously choose a seller. If more than one buyer chooses the same seller, the seller's single unit is randomly sold to one of them. Our results show a broad consistency with theoretical predictions, although price dispersion exists and is slow to decay. Prices also exceed the equilibrium level when there are only two sellers, and buyers' purchase probabilities are insufficiently responsive to price differences when there are two sellers.
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U2 - 10.1111/j.1468-2354.2007.00441.x
DO - 10.1111/j.1468-2354.2007.00441.x
M3 - Article
AN - SCOPUS:34147133413
SN - 0020-6598
VL - 48
SP - 665
EP - 691
JO - International Economic Review
JF - International Economic Review
IS - 2
ER -