Markets, correlation, and regret-matching

Sergiu Hart and Andreu Mas-Colell

Games and Economic Behavior, 2015, vol. 93, issue C, 42-58

Abstract: Inspired by the existing work on correlated equilibria and regret-based dynamics in games, we carry out a first exploration of the links between equilibria and dynamics in (exchange) economies. The leading equilibrium concept is Walrasian equilibrium, and the dynamics (specifically, regret-matching dynamics) apply to trading games that fit the economic structure and whose pure Nash equilibria implement the Walrasian outcomes. Interestingly, in the case of quasilinear utilities (or “transferable utility”), all the concepts essentially coincide, and we get simple deterministic dynamics converging to Walrasian outcomes. Connections to sunspot equilibria are also studied.

Keywords: Exchange economies; Walrasian equilibrium; Correlated equilibrium; Sunspot equilibrium; Dynamics; Regret-matching; Socially concave games; Deterministic regret-matching dynamics; Hannan set; Implementation of Walrasian equilibria (search for similar items in EconPapers)
JEL-codes: C7 D5 (search for similar items in EconPapers)
Date: 2015
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (4)

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Related works:
Working Paper: Markets, Correlation, and Regret-Matching (2013)
Working Paper: Markets, Correlation, and Regret-Matching (2013)
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Persistent link: https://EconPapers.repec.org/RePEc:eee:gamebe:v:93:y:2015:i:c:p:42-58

DOI: 10.1016/j.geb.2015.06.009

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