Martel, Jordan
[VerfasserIn]
;
Mirkin, Kenneth S
[Sonstige Person, Familie und Körperschaft];
Waters, Brian
[Sonstige Person, Familie und Körperschaft]
Anmerkungen:
Nach Informationen von SSRN wurde die ursprüngliche Fassung des Dokuments November 20, 2018 erstellt
Beschreibung:
We study market dynamics when an owner learns over time about the quality of her asset. Since this information is private, the owner sells strategically to a less informed buyer following sufficient negative information. In response, market prices feature a "U-shape" relative to the length of ownership prior to sale. As the owner initially acquires greater private information, buyers suffer greater adverse selection, and prices fall accordingly. Eventually, the probability of a strategic sale grows thin, and prices subsequently rebound. We provide evidence of a U-shaped price path in the markets for residential real estate, private equity, and construction equipment