search query: @author Shi, S. / total: 12
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| Author: | Burdett, K. Shi, S. Wright, R. |
| Title: | Pricing and Matching with Frictions |
| Journal: | Journal of Political Economy
2001 : OCT, VOL. 109:5, p. 1060-1085 |
| Index terms: | PRICING PRICES PRICE LEVEL MATCHING PROBLEM ECONOMIC CONDITIONS |
| Language: | eng |
| Abstract: | Suppose that n buyers each want one unit and o sellers each have one or more units of a good. Sellers post prices, and then buyers choose sellers. In symmetric equilibrium, similar sellers all post one price, and buyers randomize. Hence, more or fewer buyers may arrive than a seller can accommodate. The authors call these frictions. The authors solve for prices and the endogenous matching function for finite n and o and consider the limit as n and o grow. The matching function displays decreasing returns but converges to constant returns. The authors argue that the standard matching function in the literature is misspecified and discuss implications for the Beveridge curve. |
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