Multiplicity of Equilibria in Search Markets with Free Entry and Exit

In this paper I identify an instance of multiplicity of equilibria, in search markets with production cost heterogeneity. I show that if firms may enter or exit the market, there may be multiple equilibria. I provide a monotonicity property, which is necessary and sufficient for uniqueness. Multiplicity vanishes as the search cost gets small. Multiple equilibria can be ranked by welfare.

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Year of publication:	2004-11
Authors:	Pereira, Pedro
Institutions:	Autoridade de Concorrência, Government of Portugal
Subject:	Search \| Multiplicity of Equilibria \| Coordination Failure

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Extent:	application/pdf
Series:	Working Papers.
Type of publication:	Book / Working Paper
Notes:	Number 03 19 pages
Classification:	D43 - Oligopoly and Other Forms of Market Imperfection ; D83 - Search, Learning, Information and Knowledge ; L13 - Oligopoly and Other Imperfect Markets
Source:	RePEc - Research Papers in Economics

Persistent link: https://www.econbiz.de/10005115562