TY  - RPRT
        AU  - Lester, Benjamin R.
AU  - Visschers, Ludo
AU  - Wolthoff, Ronald P.
        TI  - Competing with Asking Prices
        PY  - 2013/Jan/
        PB  - Institute of Labor Economics (IZA)
        CY  - Bonn
        T2  - IZA Discussion Paper
        IS  - 7163
        UR  - https://www.iza.org/index.php/publications/dp7163
        AB  - In many markets, sellers advertise their good with an asking price. This is a price at which the seller is willing to take his good off the market and trade immediately, though it is understood that a buyer can submit an offer below the asking price and that this offer may be accepted if the seller receives no better offers. Despite their prevalence in a variety of real world markets, asking prices have received little attention in the academic literature. We construct an environment with a few simple, realistic ingredients and demonstrate that using an asking price is optimal: it is the pricing mechanism that maximizes sellers' revenues and it implements the efficient outcome in equilibrium. We provide a complete characterization of this equilibrium and use it to explore the positive implications of this pricing mechanism for transaction prices and allocations.
        KW  - competing mechanism design
KW  - asking prices
KW  - auctions with entry
KW  - competitive search
        ER  -