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Trust or robustness? An ecological approach to the study of auction and bilateral markets

Author

Listed:
  • Laura Hernandez

    (LPTM - UMR 8089 - Laboratoire de Physique Théorique et Modélisation - CNRS - Centre National de la Recherche Scientifique - CY - CY Cergy Paris Université)

  • Annick Vignes

    (CAMS - Centre d'Analyse et de Mathématique sociales - EHESS - École des hautes études en sciences sociales - CNRS - Centre National de la Recherche Scientifique)

  • Stéphanie Saba

    (CRED - Centre de Recherche en Economie et Droit - UP2 - Université Panthéon-Assas)

Abstract

Centralized markets are often considered more efficient than bilateral exchanges because information is public and the same for all the agents. On decentralized markets, where the information is private, the influence of trust on the market outcome has been underlined by many authors. We present an empirical study of the distinctive Boulogne-sur-Mer Fish Market (where both buyers and sellers can choose to trade by either bidding or bargaining), focused on the interactions between agents. Our approach is inspired by studies of mutualistic ecosystems, where the agents are of two different types (as in plant-pollinator networks) and the interactions only take place between agents of different kinds, naturally providing benefits to both. In our context, where the two kinds of agents are buyers and sellers, our study shows that not only do their interactions bring economic benefits for the agents directly involved, but they also contribute to the stability of the market. Our results help to explain the surprising coexistence of the two forms of market in the distinctive Boulogne sur Mer Fish Market.

Suggested Citation

  • Laura Hernandez & Annick Vignes & Stéphanie Saba, 2018. "Trust or robustness? An ecological approach to the study of auction and bilateral markets," Post-Print hal-02005040, HAL.
    • Handle: RePEc:hal:journl:hal-02005040
    DOI: 10.1371/journal.pone.0196206
    Note: View the original document on HAL open archive server: https://hal.science/hal-02005040
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    References listed on IDEAS

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    Cited by:

    1. Wolff, François-Charles & Asche, Frank, 2022. "Pricing heterogeneity and transaction mode: Evidence from the French fish market," Journal of Economic Behavior & Organization, Elsevier, vol. 203(C), pages 67-79.
    2. Sylvain Mignot & Annick Vignes, 2019. "Trust somebody but choose carefully : an empirical analysis of social relationships on an exchange market," Working Papers hal-02005026, HAL.
    3. Johannes Wachs & Mih'aly Fazekas & J'anos Kert'esz, 2019. "Corruption Risk in Contracting Markets: A Network Science Perspective," Papers 1909.08664, arXiv.org.

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