MIDDLEMEN IN SEARCH EQUILIBRIUM WITH INTENSIVE AND EXTENSIVE MARGINS

• 成果类型: Article
• 署名作者: Gong, Grace Xun; Wright, Randall
• 署名单位: Zhejiang University
• 刊物名称: INTERNATIONAL ECONOMIC REVIEW
• ISSN/ISSBN: 0020-6598
• DOI: 10.1111/iere.12721
• 发表日期: 2024
• 页码: 1657-1679
• 关键词: money; EFFICIENCY; liquidity; MARKETS; MODEL

摘要

We study endogenous intermediation activity, the implied transaction pattern-direct trade, indirect trade, or both-and implications for efficiency. Related papers have agents exchanging indivisible goods or assets, capturing only extensive margins (trade frequency). To capture intensive margins, we incorporate divisibility representing quantity or quality. We characterize equilibrium, show how it depends on bargaining powers and costs, and how intensive margins matter-for example, middlemen with high bargaining power may charge more but offer higher quantity/quality, thus improving welfare. A tax-subsidy policy is designed to achieve efficiency. A monetary version lets us compare money and middlemen and further discuss policy.