Mr Wolfgang Ridinger

Mr Wolfgang Ridinger

PhD Candidate in Economics

Department of Economics

Connect with me

Languages
English, German
Key Expertise
Industrial Organization

About me

Research interest
Industrial Organization (primary)

Job market paper
Buying and Selling Classic Cars

Read the abstract and download the paper

I study the interaction of resale, aggregate shocks, and decentralized trade when buyers and sellers are forward looking. I develop a fully dynamic structural model of a sequential auctions market with resale and aggregate shocks. I then estimate the model on data from classic car auctions. The model matches the strong positive correlation between prices and the state of the economy that is also present in the data. Only half of the variation in prices over the business cycle stems from the direct effect of the aggregate wealth shock. The remaining half is due to the dynamic decisions of buyers and sellers. A series of counterfactual experiments shows that allowing for instantaneous resale substantially increases average car prices and their volatility over the business cycle compared to allowing no resale at all, a result that is driven primarily by the possibility to speculate. A second set of counterfactual simulations reveals that centralizing trade lowers prices and increases the volume of trade. Price volatility remains unchanged in this scenario, even with frequent resale opportunities because there is less scope for speculation in a centralized market.

Download the paper

Download CV

Publications and additional papers

Available soon

Contacts

Placement Officer
Professor Mark Schankerman

Supervisor
Professor Martin Pesendorfer

References
Professor Martin Pesendorfer
Dr Matthew Gentry
Dr Pasquale Schiraldi

Contact information

Email
w.ridinger1@lse.ac.uk

Room number
32L.4.09

Office Address
Department of Economics,
London School of Economics and Political Science,
Houghton Street, London WC2A 2AE