Supply and demand law under limited information

Yi-Cheng Zhang

Physica A: Statistical Mechanics and its Applications, 2005, vol. 350, issue 2, 500-532

Abstract: We present a model for the supply-demand law with quality and limited information capability. We postulate that imperfect information permeates in almost all economic transactions to varying degrees. Through a simple model we outline a research agenda that re-examines many standard issues in economics. Our analysis shows that whereas imperfect information can be improved, it leads to new uncertainties so that the perfect information limit can never be reached. As a corollary neoclassical perfect equilibrium can never be attained.

Date: 2005
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Persistent link: https://EconPapers.repec.org/RePEc:eee:phsmap:v:350:y:2005:i:2:p:500-532

DOI: 10.1016/j.physa.2004.11.057

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