Partnerships, Lemons and Efficient Trade
AbstractWe study the possibility of efficient trade with informationally interdependent valuations. In a model based on the bilateral trade situation studied in Myerson and Satterthwaite (1983) efficient trade is only possible in trivial cases where the seller's valuation always exceeds the buyer's valuation or vice versa. In contrast to Myerson and Satterthwaite's result, trade may not occur with probability one even though it is common knowledge that trade is always efficient. This generalizes the result of Akerlof (1970). We also analyze a generalization of the model in Cramton et al. (1987) where, ex-ante, the good is jointly owned by a partnership. In contrast to the private valuations case, we can not always find a partnership that can be dissolved efficiently. This break-down occurs even for valuation functions with arbitrary small common values components.
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 Sonderforschungsbereich 504, Universität Mannheim & Sonderforschungsbereich 504, University of Mannheim in its series Sonderforschungsbereich 504 Publications with number 99-71.
Length: 26 pages
Date of creation: 15 Jul 1999
Date of revision:
Note: Fieseler, Kittsteiner, Moldovanu: Department of Economics, University of Mannheim, Seminargebäude A5, 68131 Mannheim, Germany. We are grateful to Jörg Nikutta and seminar participants at Mannheim for helpful comments. Financial Support from the Deutsche Forschungsgemeinschaft, SFB 504, at the University of Mannheim, is gratefully acknowledged.
Contact details of provider:
Postal: D-68131 Mannheim
Phone: (49) (0) 621-292-2547
Fax: (49) (0) 621-292-5594
Web page: http://www.sfb504.uni-mannheim.de/
More information through EDIRC
Web page: http://www.sfb504.uni-mannheim.de
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: (Carsten Schmidt).
If references are entirely missing, you can add them using this form.