Stable processes of exchange

Stanley Reiter and Spiro Maroulis

Journal of Mathematical Economics, 2008, vol. 44, issue 12, 1398-1412

Abstract: In this paper we address a long standing gap in economic theory--the gap between claims for the dynamic efficiency of trading in markets, and the findings of formal economic theory, which justify those claims only under restrictive assumptions. We use agent-based methods to study the dynamics of exchange with trading agents who are characterized by several different preference relations. We see that outcomes converge with high probability to Pareto optima in the cases studied, including the well-known example due to Scarf.

Keywords: General; equilibrium; Agent-based; modeling (search for similar items in EconPapers)
Date: 2008
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Persistent link: https://EconPapers.repec.org/RePEc:eee:mateco:v:44:y:2008:i:12:p:1398-1412

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