Time-limited exclusivity seals compensate for missing price transparency in rough-stone markets.
Evidence
Another type of cachet used less frequently than open cachet is known as a “Zee’ch,” or “search” cachet. In a Zee’ch transaction, the seller seals the stone and signs the parcel. This signals his agreement not to show the stone to anybody else for a period of twenty-four hours. A Zee’ch seal does not give the buyer an option to purchase the sealed stone at a particular price. Rather, it gives him an exclusive right to resume negotiations for the stone at a specified time in the future. It is common for buyers to shop around by putting a variety of stones under Zee’ch. This practice makes sense in the market for rough stones where no standardized price information is available; it makes comparison shopping easier, which facilitates competitive pricing. — Lisa Bernestein, Opting out of the Legal System, 61
Categorization
- DEFINE: Explains the Zee’ch/search cachet mechanism: a temporary exclusivity seal that buys negotiation time, not an option price.
- XREF: Connects to informal market institutions and private-ordering systems that substitute for formal price discovery — a recurring theme in law-and-economics and diamond-industry scholarship. — connects to: Protection substitutes for trust when trust is lacking in transactions
- SEED: An essay angle on how low-information markets build their own comparison-shopping inventions: a closed bidding stall in place of a public quote board.