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- Title
Matching of Buyers and Sellers by Brokers: A Comparison of Alternative Commission Structures.
- Authors
Yavas, Abdullah
- Abstract
This note characterizes the set of Pareto optimal and stable matchings among buyers and sellers and examines the optimality of matching strategies employed by brokers under different commission structures. It is shown that the profit-maximizing matching strategy for the broker under percentage commission and flat-fee systems also maximizes the number of houses sold, but it minimizes the buyers' and sellers' surplus. On the other hand, net listing results in the sale of fewer houses, but it yields larger surplus for buyers and sellers.
- Subjects
HOUSE buying; HOUSE selling; REAL estate agents; BROKERS; MARKETING strategy; PROFIT
- Publication
Real Estate Economics, 1996, Vol 24, Issue 1, p97
- ISSN
1080-8620
- Publication type
Article
- DOI
10.1111/1540-6229.00682