We study two-sided markets with a finite numbers of agents on each side, and with two-sided incomplete information. Agents are matched assortatively on the basis of costly signals. A main goal is to identify conditions under which the potential increase in expected output due to assortative...

We study asymmetric second-price auctions under incomplete information. The bidders have potentially different, commonly-known, valuations for the object and private information about their entry costs. The seller, however, does not benefit from these entry costs. We calculate the equilibrium...