DTMC carries out research on markets with search frictions, and related areas in economics and econometrics. Frictions imply that market outcomes are different than in standard models of demand and supply in economics. Frictions correspond to random arrival times of trading partners. This means random waiting times before buying or selling, and uncertainty about final transaction prices.

For example, when putting a house up for sale, it is hard to predict how fast it will be sold, and at what price. Similarly, a worker looking for employment does not know in advance how long he or she will have to keep looking before landing a job, or at what wage this will be. When shopping for a loan at the bank, there is uncertainty about what interest rate can be negotiated, and at which bank, etc.

Search frictions have been applied in the analysis of labor markets, real estate, money, macroeconomics, finance, international trade, industrial organisation, public economics, marriage markets, etc.

The relevant theoretical and empirical methods include stochastic dynamic programming, duration models, matching models, network models, strategic models, dynamic equilibrium models, econometrics/machine learning/big data methods, the analysis of register data, and other data types.

DTMC carries out research in these and related areas. This research is important for improving our understanding of the functioning of markets, and to generate better predictions and policy analyses.