Directed search and optimal production (Q694735): Difference between revisions

This article provides a model where sellers can advertise their general trading mechanisms, such as the number of buyers that can be served and additional payments based on the realized demand, without the buyers being able to coordinate their visiting strategies. The author begins with an overview of the literature followed by an outline of the base model. This is followed by a detailed study of a benchmark case before extending the results to the general model, where it is proven that symmetric equilibria are constraint-efficient. Several useful theorems are presented with proof and a closed form formula for the equilibrium prices is derived.