This file is part of IDEAS, which uses RePEc data


[ Papers | Articles | Software | Books | Chapters | Authors | Institutions | JEL Classification | NEP reports | Search | New papers by email | Author registration | Rankings | Volunteers | FAQ | Blog | Help! ]

The Optimality of a Simple Market Mechanism

Author info | Abstract | Publisher info | Download info | Related research | Statistics
Author Info
Mark A. Satterthwaite () (Kellogg Graduate School of Management, Northwestern University, IL. U.S.A.)
Steven R. Williams () (University of Illinois, U.S.A.)
Abstract

Strategic behavior in a finite market can cause inefficiency in the allocation, and market mechanisms differ in how successfully they limit this inefficiency. A method for ranking algorithms in computer science is adapted here to rank market mechanisms according to how quickly inefficiency diminishes as the size of the market increases. It is shown that trade at a single market-clearing price in the "k"-double auction is "worst-case asymptotic optimal" among all plausible mechanisms: evaluating mechanisms in their least favorable trading environments for each possible size of the market, the "k"-double auction is shown to force the worst-case inefficiency to zero at the fastest possible rate. Copyright The Econometric Society 2002.

Download Info
To download:

If you experience problems downloading a file, check if you have the proper application to view it first. Information about this may be contained in the File-Format links below. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.

File URL: http://www.blackwellpublishing.com/ecta/asp/abstract.asp?iid=5&aid=355&vid=70
File Format: text/html
File Function: link to full text
Download Restriction: Access to full text is restricted to subscribers.

As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.

Publisher Info
Article provided by Econometric Society in its journal Econometrica.

Volume (Year): 70 (2002)
Issue (Month): 5 (September)
Pages: 1841-1863
Download reference. The following formats are available: HTML (with abstract), plain text (with abstract), BibTeX, RIS (EndNote, RefMan, ProCite), ReDIF
Handle: RePEc:ecm:emetrp:v:70:y:2002:i:5:p:1841-1863

Contact details of provider:
Phone: 1 212 998 3820
Fax: 1 212 995 4487
Email:
Web page: http://www.econometricsociety.org/
More information through EDIRC

Order Information:
Email:
Web: http://www.blackwellpublishing.com/memb.asp?ref=0012-9682

For technical questions regarding this item, or to correct its listing, contact: (Christopher F. Baum).

Related research
Keywords:

Other versions of this item:

Cited by:
(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)
  1. Martin W Cripps & Jeroen M Swinkels, 2003. "Efficiency of Large Double Auctions," Levine's Working Paper Archive 666156000000000329, David K. Levine. [Downloadable!]
    Other versions:
  2. Thomas Troger, 2002. "Double Auctions, Ex-Post Participation Constraints, and the Hold-Up Problem," University of California at Santa Barbara, Economics Working Paper Series 19-02, Department of Economics, UC Santa Barbara. [Downloadable!]
    Other versions:
  3. Art Shneyerov, 2006. "Dynamic Matching with Two-sided Incomplete Information and Participation Costs," Theory workshop papers 815595000000000009, UCLA Department of Economics. [Downloadable!]
  4. Ohad Kadan, 2004. "Equilibrium in the Two Player, k-Double Auction with Affiliate Private Values," Working Papers 2004.12, Fondazione Eni Enrico Mattei. [Downloadable!]
  5. Marco LiCalzi & Paolo Pellizzari, 2006. "Simple Market Protocols for Efficient Risk Sharing," Working Papers 136, Department of Applied Mathematics, University of Venice. [Downloadable!]
    Other versions:
  6. Schmitz, Patrick W. & Tröger, Thomas, 2006. "Garbled Elections," CEPR Discussion Papers 5958, C.E.P.R. Discussion Papers. [Downloadable!] (restricted)
    Other versions:
    • Patrick W. Schmitz & Thomas Tröger, 2006. "Garbled Elections," Discussion Papers 195, SFB/TR 15 Governance and the Efficiency of Economic Systems, Free University of Berlin, Humboldt University of Berlin, University of Bonn, University of Mannheim, University of Munich. [Downloadable!]
  7. Liad Blumrosen & Michal Feldman, 2005. "Implementation with a Bounded Action Space," Levine's Bibliography 122247000000000930, UCLA Department of Economics. [Downloadable!]
  8. John Duffy & Alexander Matros & Ted Temzelides, 2008. "Competitive Behavior in Market Games: Evidence and Theory," Working Papers 366, University of Pittsburgh, Department of Economics, revised Mar 2009. [Downloadable!]
    Other versions:
  9. Liad Blumrosen & Michal Feldman, 2005. "Implementation with a Bounded Action Space," Discussion Paper Series dp412, Center for Rationality and Interactive Decision Theory, Hebrew University, Jerusalem. [Downloadable!]
  10. Satterthwaite, Mark & Shneyerov, Art, 2004. "Dynamic Matching,Two-sided Incomplete Information, and Participation Costs: Existence and Convergence to Perfect Competition," Micro Theory Working Papers shneyerov-04-12-17-02-54-, Microeconomics.ca Website, revised 17 Dec 2004. [Downloadable!]
    Other versions:
  11. Susan Athey & David Miller, 2006. "Efficiency in Repeated Trade with Hidden Valuations," Levine's Bibliography 784828000000000256, UCLA Department of Economics. [Downloadable!]
    Other versions:
Statistics
Access and download statistics

Did you know? The most prolific authors have over 700 items listed on IDEAS.

This page was last updated on 2009-11-12.

This information is provided to you by IDEAS at the Department of Economics, College of Liberal Arts and Sciences, University of Connecticut using RePEc data on a server sponsored by the Society for Economic Dynamics.