Essays on Asymmetric Information

This thesis comprises three chapters that examine strategic behavior under asymmetric information in auctions and bilateral trade. Chapter 1 studies bidding behavior in concurrent auctions for heterogeneous goods when bidders can participate in only one auction. The analysis highlights how endogenous market entry generates a stochastic number of competitors and a self-selection effect that shapes bidding strategies, which collectively determine the equilibrium market-entry pattern and bidding behavior upon entry. Under independent private values, bidders always bid for their favorite good, while with affiliated values, bidders may enter a less-preferred market to avoid competition. Chapters 2 and 3 both investigate bilateral trade environments with two-sided private information, but with different economic motivations. Chapter 2, which is a joint work with Nenad Kos, analyzes expert markets in which an informed expert sells services to a consumer who privately knows the difficulty (and value) of his problem. Prices serve as signals of expertise. The chapter characterizes the equilibria and evaluates welfare across different outcomes. It shows that the expert can sometimes increase her profit by grouping her types to segment demand more effectively, while full separation yields the highest welfare by revealing information and lowering prices. Chapter 3 studies a product market in which a seller privately knows a horizontal product attribute, while the consumer privately knows his taste. The seller chooses whether to disclose this attribute before setting a price. The analysis uncovers how disclosure incentives depend on the transport cost specifications and characterizes when partial pooling or full disclosure emerges in equilibrium. It also shows that mandatory disclosure can harm both the seller and the consumer when the market is not fully covered. Together, these chapters demonstrate how asymmetric information shapes market entry, price signaling, and disclosure decisions, and provide new insights into how private information interacts with market structure in both auction and bilateral-trade environments.