Trading in Networks: Theory and Experiments

Choi, S, Galeotti, A and Goyal, S (2017) Trading in Networks: Theory and Experiments. Journal of the European Economic Association, 15 (4). pp. 784-817. ISSN 1542-4766 OPEN ACCESS

Abstract

We propose a model of posted prices in networks. The model maps traditional concepts of market power, competition, and double marginalization into networks, allowing for the study of pricing in complex structures of intermediation, such as supply chains, transportation and communication networks, and financial brokerage. We provide a complete characterization of equilibrium prices. Our experiments complement our theoretical work and point to node criticality as an organizing principle for understanding pricing, efficiency, and the division of surplus in networked markets.

More Details

Item Type: Article
Subject Areas: Economics
Funder Name: Keynes Fund for Applied Research, National Research Foundation of Korea, European Research Council, Leverhume Trust
Date Deposited: 18 Oct 2019 11:05
Last Modified: 06 Oct 2020 17:39
URI: https://lbsresearch.london.edu/id/eprint/1251
More

Export and Share


Statistics

Altmetrics
View details on Dimensions' website

Downloads from LBS Research Online

View details

Actions (login required)

Edit Item Edit Item