Ellison G, Fudenberg D, Mobius M.
Competing Auctions. Journal of European Economic Association [Internet]. 2004;2 (1) :30-66.
Publisher's VersionAbstractThis paper examines a simple model of competing auction sites to give some insights into the concentration of auction markets. In our model, there are B ex-ante identical buyers, each with unit demand, and S sellers, each with a single unit of the good to sell and a reservation value of zero. At the start of the model, buyers and sellers simultaneously choose between two possible locations. Buyers then learn their private values for the good, and a uniform-price auction is held at each location. This is a very stark model, but we believe that it provides some useful insights, and that it serves as a benchmark case for richer and more realistic models.
Article Rosenblat T, Mobius M.
Getting Closer or Drifting Apart. Quarterly Journal of Economics [Internet]. 2004;119 (3) :971-1009.
Publisher's VersionAbstractAdvances in communication and transportation technologies have the potential to bring people closer together and create a ‘global village’. However, they also allow heterogenous agents to segregate along special interests which gives rise to communities fragmented by type rather than geography. We show that lower communication costs should always decrease separation between individual agents even as group-based separation increases. Each measure of separation is pertinent for distinct types of social interaction. A group-based measure captures the diversity of group preferences that can have an impact on the provision of public goods. An individual measure correlates with the speed of information transmission through the social network that affects, for example, learning about job opportunities and new technologies. We test the model by looking at coauthoring between academic economists before and during the rise of the Internet in the 1990s.
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