Learning in an Equilibrium Search Model
AbstractThis paper explores the role of learning in an equilibrium search model with asymmetric information. Firms with identical but privately observed marginal cost sell a homogeneous good to heterogeneously informed consumers. A reservation-price equilibrium exists if the uninformed consumers' search cost is sufficiently large. In this equilibrium, the amount of price dispersion is inversely related to the realization of marginal cost. Also, the average price level is less responsive to cost changes than when cost is observable. Finally, uncertainty about firms' marginal cost increases the expected price level. Copyright 1994 by Economics Department of the University of Pennsylvania and the Osaka University Institute of Social and Economic Research Association.
Download InfoTo our knowledge, this item is not available for download. To find whether it is available, there are three options:
1. Check below under "Related research" whether another version of this item is available online.
2. Check on the provider's web page whether it is in fact available.
3. Perform a search for a similarly titled item that would be available.
Bibliographic InfoPaper provided by Stanford - Institute for Thoretical Economics in its series Papers with number 37.
Length: 36 pages
Date of creation: 1991
Date of revision:
Contact details of provider:
Postal: STANFORD UNIVERSITY, Stanford Institute for Theoretical Economics,STANFORD CALIFORNIA 94305 U.S.A.
Phone: (650) 723-2218
Fax: (650) 725-5702
Web page: http://www.stanford.edu/group/SITE/
More information through EDIRC
economic equilibrium ; enterprises ; consumption;
Other versions of this item:
You can help add them by filling out this form.
CitEc Project, subscribe to its RSS feed for this item.
This item has more than 25 citations. To prevent cluttering this page, these citations are listed on a separate page. reading list or among the top items on IDEAS.Access and download statisticsgeneral information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Thomas Krichel).
If references are entirely missing, you can add them using this form.