Signaling in dynamic markets with adverse selection

• 成果类型: Article
• 署名作者: Barsanetti, Bruno; Camargo, Braz
• 刊物名称: JOURNAL OF ECONOMIC THEORY
• ISSN/ISSBN: 0022-0531
• DOI: 10.1016/j.jet.2022.105558
• 发表日期: 2022
• 关键词: Adverse selection; signaling; market efficiency; Trading frictions

摘要

We study trade in dynamic decentralized markets with adverse selection. In contrast to the literature on the topic so far, we assume that the informed sellers make the offers so that signaling through prices is possible. We establish basic properties of equilibria, discuss the standard two-type case in detail, and then analyze the general finite-type case. We prove that market efficiency, measured by the maximum gains from trade in equilibrium, is invariant to trading frictions. Our analysis shows that screening and signaling lead to markedly different trading outcomes.(c) 2022 Elsevier Inc. All rights reserved.