We present a model in which intermediaries that compete with a search market emerge. Agents are heterogenous vis à vis a production cost. They are allowed to choose both their economic activity, becoming a producer or a middleman, and their transaction strategies. Entering the intermediation...

The search-theoretic approach to monetary economics, initiated by the seminal papers of Kiyotaki and Wright [1989, 1993], offers a framework for the rationale of money, defined as an intrinsically useless object or good used as medium of exchange. This class of models has been criticized for the...