Frictions in Product Markets

76 Pages Posted: 20 Sep 2021 Last revised: 12 Jun 2023

See all articles by Alessandro Gavazza

Alessandro Gavazza

London School of Economics & Political Science (LSE) - Department of Economics

Alessandro Lizzeri

Princeton University - Department of Economics

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Date Written: September 2021

Abstract

This is an invited chapter for the forthcoming Volume 4 of the Handbook of Industrial Organization. We focus on markets with frictions, such as transaction costs, asymmetric information, search and matching frictions. We discuss how such frictions affect allocations, favor the emergence of intermediaries or dealers, and potentially create market power. Our focus is mostly on markets with many participants rather than on transactions that are bilateral or involve a small number of players.

Suggested Citation

Gavazza, Alessandro and Lizzeri, Alessandro, Frictions in Product Markets (September 2021). NBER Working Paper No. w29259, Available at SSRN: https://ssrn.com/abstract=3926940

Alessandro Gavazza (Contact Author)

London School of Economics & Political Science (LSE) - Department of Economics ( email )

Houghton Street
London WC2A 2AE
United Kingdom

Alessandro Lizzeri

Princeton University - Department of Economics ( email )

Princeton, NJ 08544-1021
United States
08544 (Fax)

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