Hoppe, Heidrun C.; Moldovanu, Benny; Sela, Aner - C.E.P.R. Discussion Papers - 2006
We study two-sided markets with a finite numbers of agents on each side, and with two-sided incomplete information … potential increase in expected output due to assortative matching (relative to random matching) is completely offset by the … costs of signalling. We also study how the signalling activity and welfare on each side of the market change when we vary …