Marketmaking Middlemen

• 成果类型: Article
• 署名作者: Gautier, Pieter; Hu, Bo; Watanabe, Makoto
• 署名单位: Vrije Universiteit Amsterdam; Fudan University; Shanghai Institute of International Finance & Economics; Kyoto University
• 刊物名称: RAND JOURNAL OF ECONOMICS
• ISSN/ISSBN: 0741-6261
• DOI: 10.1111/1756-2171.12431
• 发表日期: 2023
• 页码: 83-103
• 关键词: search equilibrium; COMPETITION; intermediation; specialist; sellers; buyers

摘要

This article develops a model in which market structure is determined endogenously by the choice of intermediation mode. There are two representative modes of intermediation that are widely used in real-life markets: one is a middleman mode where an intermediary purchases inventory from the wholesale market and resells to buyers; the other is a market-making mode where an intermediary offers a platform for buyers and sellers to meet and trade. We show that a marketmaking middleman, who adopts a mixture of these two intermediation modes, can emerge in a directed search equilibrium and discuss implications for the market structure.