Competitive-search equilibrium in monetary economies

Competitive search was recently introduced in monetary economics by Rocheteau and Wright [Money in search equilibrium, in competitive equilibrium, and in competitive search equilibrium, Econometrica 73 (2005) 175–203]. We extend their work by eliminating the restriction that the fees market makers charge to enter a submarket must be either non-negative or identical for buyers and sellers. Without this restriction, buyers pay a positive fee to enter the submarket they visit and nothing else when they meet a seller. Sellers are remunerated by the market makers from the entry fees collected from the buyers. This trading arrangement allows buyers to perfectly predict their expenses, so the opportunity cost of holding idle money balances is eliminated.