Fee Setting Intermediaries : On Real Estate Agents , Stock Brokers , and Auction Houses ∗

@inproceedings{Loertscher2008FeeSI,
  title={Fee Setting Intermediaries : On Real Estate Agents , Stock Brokers , and Auction Houses ∗},
  author={Simon Loertscher and A. O. Niedermayer},
  year={2008}
}
Mechanisms where intermediaries charge a commission fee and have the sellers set the price are widely used in practice e.g. by real estate agents, stock brokers, art galleries, or auction houses. We model competition between intermediaries in a dynamic random matching model, where in every period a buyer, a seller, and an intermediary are randomly matched. In any period, every intermediary has a temporary monopoly and designs an exchange mechanism that maximizes his own expected profits… CONTINUE READING

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