A note on the seller's optimal mechanism in bilateral trade with two-sided incomplete information

Research output: Contribution to journalArticle

  • 11 Citations

Abstract

It is shown with an example that, in bilateral trade problems with two-sided incomplete information, some seller types may obtain higher expected payoffs in mechanisms other than the one where they make a take-it-or-leave-it offer, contrary to popular belief. If one looks at the mechanism selection problem of the (informed) seller, then the optimality of a take-it-or-leave-it offer for the seller is restored. Journal of Economic Literature Classification Numbers: C72, C78, D82.

LanguageEnglish
Pages267-271
Number of pages5
JournalJournal of Economic Theory
Volume87
Issue number1
DOIs
StatePublished - Jul 1999
Externally publishedYes

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Seller
Bilateral trade
Incomplete information
Economics
Optimality

ASJC Scopus subject areas

  • Economics and Econometrics

Cite this

A note on the seller's optimal mechanism in bilateral trade with two-sided incomplete information. / Yilankaya, Okan.

In: Journal of Economic Theory, Vol. 87, No. 1, 07.1999, p. 267-271.

Research output: Contribution to journalArticle

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