In Chapter 1 we study price determination in a market with n identical buyers and a seller who initially commits to some capacity. Sales are sequential and each price is determined by strategic bargaining. A unique subgame perfect equilibrium exists. It is characterized by absence of costly...

We endogenize the trading mechanism selection in a model of directed search with risk averse buyers and show that the unique symmetric equilibrium entails all sellers using fixed price trading. Mechanisms that prescribe the sale price as a function of the realized demand (auctions, bargaining,...

The housing market exhibits a puzzling yet repetitive seasonal boom and bust cycle where prices and trade volume rise in summers and fall in winters. This paper presents a search model that analytically generates the observed deterministic cycle.

We develop an equilibrium search model of the housing market where sellers may become distressed as they are unable to sell. A unique steady state equilibrium exists where distressed sellers attempt fire sales by accepting prices that are substantially below fundamental values. During periods...

We present an equilibrium search model of competing mechanisms where some buyers are budget constrained. Absent budget constraints, the existing literature capitulates that if buyers differ in their valuations then in the unique equilibrium all sellers hold second price auctions (e.g. McAfee...

We present a stylized model of the over-the-counter (OTC) markets in the tradition of Duffie, Gârleanu, and Pedersen 2005 with three distinctive features: (i) Buyers' willingness to pay is private information. (ii) Dividends depend on the state of the macro economy. (iii) Sellers become...

Fixed-price selling is common in today's markets. While previous research in marketing and economics literatures provide several intuitive reasons for the emergence of fixed-price selling (e.g. clarity and simplicity of managing the fixed-price process, reduced coordination and information...

This thesis includes three essays analyzing the role of fiat money in decentralized trade. Essay 1 develops a model that describes a two-country-two-currency economy, in which prices are endogenized by using the "split-the-surplus" rule. The government generates seignorage revenue by issuing...

This thesis consists of three essays. The first two essays employ monetary search theoretic models to examine issues related to money and specialization and bilateral exchange rate determination, respectively. The third essay, which is empirical in nature, investigates fundamental determinants...

Models of monetary economies with explicit micro-foundations play a central role in macroeconomics. A common assumption is the quasi-linearity of individuals' preferences. Moreover, anonymity rules out credit and implies that individuals are constrained in their ability to save and borrow. These...