John Kennes

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We analyze monetary exchange in a model that allows for directed search and multilateral matches. We consider environments with divisible goods and indivisible money, and compare the results with those in models that use random matching and bilateral bargaining. Two different pricing mechanisms are used: ex ante price posting, and ex post bidding(More)
This paper explores the trade-off between the short-term benefits of false quality advertisements against the longer term costs of reputation damage. A directed search model is constructed in which submarkets are created by the advertisements and reputations of sellers. A reputation system links misleading advertisements in the present period to a lower(More)
This paper analyzes monetary exchange in a search model allowing for multilateral matches to be formed, according to a standard urn-ball process. We consider three physical environments: indivisible goods and money, divisible goods and indivisible money, and divisible goods and money. We compare the results with Kiyotaki and Wright (1993), Trejos and Wright(More)
We examine how much of the observed wage dispersion among similar workers can be explained as a consequence of a lack of coordination among employers. To do this, we construct a directed search model with homogenous workers but where firms can create either good or bad jobs, aimed at either employed or unemployed workers. Workers in our model can also sell(More)
Many matching markets are dynamic, with one side's priorities often depending on previous allocations. This creates opportunities for manipulations that do not exist in static matching problems. The school-choice problem, for example, exhibits considerable student mobility and a priority system that favors incumbent students and their siblings. In such a(More)
By reducing the risk of unwanted parenthood, better contraception reduces the cost of unmarried sex, increasing the value of single life. A simple one-period example suggests this could explain why marriage and birth rates have declined since 1970. We extend the analysis to allow for repeated matching over many periods, modelling the shotgun-marriage,(More)
The theory of competitive auctions offers a coherent framework for modelling coordination frictions as a non-cooperative game. The theory represents an advancement over cooperative approaches that make exogenous assumptions about how output is divided between buyers and sellers and about the forces that bring buyers and sellers into local markets. Moreover,(More)