This paper examines the role of a middleman as an expert in markets with asymmetric information. A seller has one unit of an indivisible good whose quality is determined by his effort. Buyers observe neither the seller's effort nor the quality of the good. A middleman, after observing a signal...

We examine used car dealers' roles as intermediaries. We present empirical evidence supporting that cars sold by dealers have higher quality: (1) dealer transaction prices are higher than private market prices and this dealer premium increases in the age of the car as a ratio and is hump-shaped...

We consider the equilibrium interplay between sellers' price competition and consumers' perception of product differentiation. We analyze a situation where, before trading, consumers acquire information at a cost about their preferences between sellers' differentiated products. The incentive for...