We consider price-fee competition in bilateral oligopolies with perfectly-divisible goods, non-expandable infrastructures, concentrated agents on both sides, and constant marginal costs. We define and characterize stable market outcomes. Buyers exclusively trade with the supplier with whom they...

The bargaining model with stochastic order of proposing players is properly embedded in continuous time and it is strategically equivalent to the alternating offers model. For all parameter values, the pair of equilibrium proposals corresponds to the Nash bargaining solution of a modified...

We study strategic negotiation models featuring costless delay, general recognition procedures, endogenous voting orders, and finite sets of alternatives. Two examples show: 1. non-existence of stationary subgame-perfect equilibrium (SSPE). 2. the recursive equations and optimality conditions...

We analyze the simplest Condorcet cycle with three players and three alternatives within a strategic bargaining model with recognition probabilities and costless delay. Mixed consistent subgame perfect equilibria exist whenever the geometric mean of the agents' risk coefficients, ratios of...

In this paper we investigate trade union formation. To this end we apply a model with two types of labour where both groups decide on whether they prefer to be represented by either two independent craft-specific (professional) labour unions or by a joint (encompassing) labour union. Applying...

We consider the problem of axiomatizing the Shapley value on the class of assignment games. We first show that several axiomatizations of the Shapley value on the class of all TU-games do not characterize this solution on the class of assignment games by providing alternative solutions that...

This paper investigates the interaction between education decisions by workers and investment decisions by firms in a random matching model with endogenous heterogeneity. I analyze the efficiency properties of the equilibrium and find that in the presence of search frictions and investment costs...

This paper develops a search-theoretic model of the cross-sectional distribution of asset returns. It abstracts from risk premia and focuses exclusively on liquidity. A float-adjusted return model (FARM) is derived, explaining the pricing of liquidity with a simple linear formula: In...

We develop a model in which firms set their salary levels before matching with workers. Wages fall relative to any competitive equilibrium while profits rise almost as much, implying little inefficiency. Furthermore, the best firms gain the most from the system while wages become compressed. We...

In this paper, we develop a search-based model of asset trading. We assume that investors differ in their horizons, and can invest in two identical assets. The asset markets are partially segmented: investors can search in only one market, but can decide which one. We show that there exist a...