Medieval Matching Markets
67 Pages Posted: 18 Dec 2010 Last revised: 21 Dec 2010
Date Written: December 10, 2010
This paper studies the market microstructure of pre-industrial Europe. In particular we investigate the institution of the broker in markets and fairs, and develop a unique data set of approximately 1100 sets of brokerage rules in 42 merchant towns in Central and Western Europe from the late 13th to the end of the 17th century. We show that towns implemented brokerage as an efficient matchmaking institution in a two-sided market problem. Furthermore, towns differentiated seller-friendly from buyer-friendlier matching mechanisms. We show that the decision to implement matchmaking mechanisms, and whether these mechanisms would be buyer- or seller friendly, depends on the products in question and the stated policy goals of the town, as well as time and geographic variables.
Keywords: pre-industrial markets, market microstructure, efficient matching
JEL Classification: D4, N23
Suggested Citation: Suggested Citation