This paper examines how the distribution of prices changes with the number of competitors in the market. Using gasoline price data from the Netherlands we find that as competition increases, the distribution of prices spreads out: the low prices go down while the high prices go up, on average....

We consider an oligopolistic market where firms compete in price and quality and where consumers are heterogeneous in knowledge: some consumers know both the prices and quality of the products offered, some know only the prices and some know neither. We show that two types of signalling...

The ‘backhaul problem’ is characterized by an imbalance in transport flows between locations. This problem is usually studied in a perfectly competitive framework, which essentially predicts that when the imbalance is sufficiently large, the freight price of transport from low demand regions...

Recent research has shown that the standard labor market matching model fails to match the dynamics of US data. In particular, the model lacks sufficient propagation of shocks. This paper shows that refining the informational structure of the model leads to significant improvements along this...

It is often argued that a mandatory minimum wage is binding only if the wage density displays a spike at it. In this paper we analyze a model with wage setting, search frictions, and heterogeneous production technologies, in which imposition of a minimum wage affects wages even though, after...

This paper first documents the increase in the time lag with which labor input reacts to output fluctuations ("the labor adjustment lag") that is visible in US data since the mid-1980s. We show that a lagged labor adjustment response is optimal in a setting where there is uncertainty about the...