We study  informed principal problems in a bilateral trade environment where a seller and a buyer have private information about independent types affecting their interdependent valuations. The seller has full bargaining power to offer a  mechanism. We prove both the existence of a D1 equilibrium and the uniqueness of the equilibrium interim payoff vector for the seller. The uniqueness result holds even if the refinement concept is weakened to the intuitive criterionunder certain regularity conditions. The refined equilibriumpayoff vectors for both players are characterized by the seller's best incentive-feasible allocation among those that are ex post incentive compatible and individually rational for the buyer. The allocation takes a simple format of (almost-)fixed prices if the virtual surplus is strictly increasing in the buyer's type. We show that the privacy of the seller's information causes undersupply of the good and reduces both players' interim payoffs .
We study the informed principal problems in a bilateral trade environment where both seller and buyer have private information about the types affecting their interdependent valuations. The seller has full bargaining power to offer a trading mechanism. We refine equilibria by the intuitive criterion. To eliminate each unintuitive equilibrium, we design an indirect mechanism that elicits both parties' common knowledge of the buyer's off-path belief after the mechanism itself is offered. The mechanism uses the elicited belief to decide what allocation is fully implemented. We characterize both parties' interim payoff vectors in intuitive equilibria. The result implies the uniqueness of the seller's payoff vector .
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prove both the existence of a D1 equilibrium and the uniqueness of the equilibrium interim payoff vector for the seller. The uniqueness result holds even if the refinement concept is weakened to the intuitive criterionunder certain regularity conditions. The refined equilibriumpayoff vectors for both players are characterized by the seller's best incentive-feasible allocation among those that are ex post incentive compatible and individually rational for the buyer. The allocation takes a simple format of (almost-)fixed prices if the virtual surplus is strictly increasing in the buyer's type. We show that the privacy
refine equilibria by the intuitive criterion. To eliminate each unintuitive equilibrium, we design an indirect mechanism that elicits both parties' common knowledge of the buyer's off-path belief after the mechanism itself is offered. The mechanism uses the elicited belief to decide what allocation is fully implemented. We characterize both parties' interim payoff vectors in intuitive equilibria. The result implies the uniqueness
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information causes undersupply of the good and reduces both players' interim payoffs
payoff vector