I develop a theory of intermediation in a market where agents meet bilaterally to trade and buyers cannot commit to payments. Some agents observe the past trading history of traders in the market. These informed agents can secure trades by punishing traders who previously defaulted. The...

This study examines whether and how brokers manage the distribution of their stock recommendations. We document that in a quarter if a broker’s percentage of buy recommendations in the first two months is substantially higher than the historical average, the broker issues significantly fewer...

We examine whether brokers in order-driven markets possess an information advantage over their customers. We compare the price impact of proprietary trades to customer trades in Borsa Istanbul. We find an asymmetric effect: While proprietary buy trades lead to a significant price response...

We study the effect on economic outcomes resulting from reputation in a market and related locational advantage of intermediaries through the lens of brokered transactions in the commercial real estate market. Specifically, we explore how the locational advantage generated by a reputation for...

Intermediaries in decentralized markets can affect buyer welfare both directly, by reducing expenses for buyers with high search cost and indirectly, through a search-externality that affects the prices paid by buyers that do not use intermediaries. I investigate the magnitude of these effects...

In intermediated markets, trading takes time and intermediaries extract rents. We estimate a structural search‑and‑bargaining model to quantify these trading delays, intermediaries’ ability to extract rents, and the resulting welfare losses in government and corporate bond markets. Using...

In intermediated markets, trading takes time and intermediaries extract rents. We estimate a structural search-and-bargaining model to quantify these trading delays, intermediaries’ ability to extract rents, and the resulting welfare losses in government and corporate bond markets. Using...

We study a home rental market where hosts compete in prices and decide which guests to accept. Such screening results in inefficiently many rejections and can reduce welfare. In a unique symmetric equilibrium, hosts randomize over prices so that it may be unprofitable for them to accept some...

After 10 years analysing the patent market, we have some very direct advice this year. If you are in-house counsel, to borrow a line from Samuel L Jackson: “Hold onto your butts.” These next few years are going to be tough. If you have not already signed up with a defensive aggregator such...

This paper examines the relationship between broker network connectivity and stock returns in an order-driven market. Considering all stocks traded in Borsa Istanbul between January 2006 and November 2015, we estimate the monthly density, reciprocity and average weighted clustering coefficient...

On the online content market, platforms are both “the matchmakers and the taste-makers”: the content that attracts the highest amount of consumers is promoted - namely through algorithmic recommender systems -, attracting even more consumers and drawing in even more creators of this...

We argue that the emergence of a well-developed market for patented technologies over the late nineteenth and early twentieth centuries facilitated the emergence of a group of highly specialized and productive inventors by making it possible for them to transfer to others responsibility for...

This paper analyzes how the competition among real estate brokers impacts housing prices in a typical sellers’ market in China. In a theoretical model, we discover a broker competition mechanism in which brokers compete for listings by promising higher transaction prices and compete for buyers...

This paper seeks to examine the nexus between market power and intermediation efficiency in the Kenyan banking system. Using bank-specific, annual balance sheet and profit and loss data for the period 2003-2018, we construct three measures of efficiency; overall efficiency, allocative efficiency...

Closing auction volume is steadily increasing on NYSE and Nasdaq, and now represents over 10% of trading volume. The NYSE closing auction design is highly advantageous to NYSE floor brokers, who have near-exclusive access to the auction from 3:50 pm to 4:00 pm. We show that closing auction...

This report provides an overview on the economics of attention intermediaries. It addresses the following questions: What are the economics of attention intermediaries? For competition policy, how should markets be defined and market power of attention intermediaries be assessed? What theories...

This paper develops a new framework for studying multiproduct intermediaries when consumers demand multiple products and face search frictions. We show that a multiproduct intermediary is profitable even when it does not improve consumer search efficiency. In its optimal product selection, it...

I study broker intermediation in entrepreneurial financing. Brokers intermediate 15% of startup offerings, but 20% of these brokers are unregistered "finders." Issuers using finders are 30% and 20% less likely to have successful post-funding outcomes than issuers in registered-broker and direct...

This research provides evidence on the role of information asymmetry and personal affiliations in housing transactions using a novel dataset that allows observation of detailed information about the property, broker, and seller. Sellers holding a real estate license are found to obtain about 1.6...

Data brokers share consumer data with rivals and, at the same time, compete with them for selling. We propose a “co-opetition” game of data brokers and characterise their optimal strategies. When data are “sub-additive” with the merged value net of the merging cost being lower than the...

We estimate the systemic effects of exit by a key over-the-counter (OTC) intermediary. In our model, risk-averse traders are connected by a core-periphery network. If traders are also averse to concentrated bilateral exposures then the incomplete network prevents full risk sharing. We quantify...

We identify the broker each corporate insider trades through, and show that analysts and mutual fund managers affiliated with such "inside brokers'" retain a substantial information advantage on the insider's firm, even after these trades are disclosed. Affiliated analysts issue more accurate...

Investors can execute trades through either brokers that trade on their behalf (agency intermediation) or dealers that trade with them (principal intermediation). We explain the heterogeneity in intermediation via the trade-off between monitoring brokers and incurring dealer inventory costs....

Stocks with similar characteristics but different levels of ownership by financial institutions have returns and risk premia that comove very differently with shocks to the risk bearing capacity of financial intermediaries. After accounting for observable stock characteristics, excess returns on...

This study analyzes the business model decision of social platforms with a commerce feature. In practice, social platforms can adopt either an advertising model or a brokerage model. We develop a game-theoretic model to recommend the better business model and investigate the effect of social...

Hong and Kacperczyk (2010) document that decreases in analyst competition due to broker mergers encourage analysts to please managers, leading to greater consensus optimism bias. We propose three additional effects of analyst competition. The analyst effort hypothesis suggests that weaker...

We examine the implications of interested intermediaries on corporate actions, stock prices, and investors' portfolio decisions. An interested intermediary is an asset manager who has private preferences over corporate actions, which could relate to corporate governance policies, social or...