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Constructing a set of equilibrium prices in a generalized distributed markets model

Author

Listed:
  • Zekhov, M.

    (National Research University Higher School of Economics (HSE University), Moscow, Russia)

  • Pilnik, N.

    (National Research University Higher School of Economics (HSE University), Moscow, Russia
    Lebedev Physical Institute of the Russian Academy of Sciences, Moscow, Russia
    Federal State Budgetary Institution "Financial Research Institute", Moscow, Russia)

  • Radionov, S.

    (Lebedev Physical Institute of the Russian Academy of Sciences, Moscow, Russia
    HSE University, Moscow, Russia)

Abstract

The article discusses the generalization of a distributed markets model that describes the distribution of production volumes, sales, and prices in geographically distant markets. The interaction of agents in the model is described in terms of economic equilibrium, where agents solve their optimization problems, and their decisions must be concerted. Producers in the model are characterized by production capacities and production costs, while consumers are characterized by demand volumes. To describe the interaction between consumers and producers, a matrix of logistic costs for delivering a unit of goods from each producer to each consumer is specified. The existence of equilibrium in the model is proved under certain regularity conditions, and a finite algorithm is proposed to describe the set of equilibrium prices and volumes. The model can be used to study the effects of changes in demand and supply parameters (e. g., due to economic growth or investment in production) as well as the market logistic structure (e. g., due to sanctions).

Suggested Citation

  • Zekhov, M. & Pilnik, N. & Radionov, S., 2025. "Constructing a set of equilibrium prices in a generalized distributed markets model," Journal of the New Economic Association, New Economic Association, vol. 67(2), pages 25-44.
    • Handle: RePEc:nea:journl:y:2025:i:67:p:25-44
    DOI: 10.31737/22212264_2025_2_25-44
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    References listed on IDEAS

    as
    1. Nikolay Pilnik & Stanislav Radionov & Ilya Tipunin, 2025. "Floor prices for spatially distributed markets," Operational Research, Springer, vol. 25(1), pages 1-28, March.
    2. Mehdi Ghiyasvand & James B. Orlin, 2012. "A Simple Approximation Algorithm for Computing Arrow-Debreu Prices," Operations Research, INFORMS, vol. 60(5), pages 1245-1248, October.
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    4. Lawrence J. Christiano & Martin Eichenbaum & Charles L. Evans, 2005. "Nominal Rigidities and the Dynamic Effects of a Shock to Monetary Policy," Journal of Political Economy, University of Chicago Press, vol. 113(1), pages 1-45, February.
    5. Yingrui Zhou & Taiyong Li & Jiayi Shi & Zijie Qian, 2019. "A CEEMDAN and XGBOOST-Based Approach to Forecast Crude Oil Prices," Complexity, Hindawi, vol. 2019, pages 1-15, February.
    6. Frank Smets & Raf Wouters, 2003. "An Estimated Dynamic Stochastic General Equilibrium Model of the Euro Area," Journal of the European Economic Association, MIT Press, vol. 1(5), pages 1123-1175, September.
    7. Eaves, B. Curtis, 1976. "A finite algorithm for the linear exchange model," Journal of Mathematical Economics, Elsevier, vol. 3(2), pages 197-203, July.
    8. Sami Ben Jabeur & Salma Mefteh-Wali & Jean-Laurent Viviani, 2024. "Forecasting gold price with the XGBoost algorithm and SHAP interaction values," Annals of Operations Research, Springer, vol. 334(1), pages 679-699, March.
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    Cited by:

    1. M. S. Zekhov & N. P. Pil’nik & S. A. Radionov, 2025. "Impact of Tariff Policy Measures on Global Markets of Mineral Fertilizers: A Quantitative Assessment," Studies on Russian Economic Development, Springer, vol. 36(5), pages 623-633, October.

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    Keywords

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    JEL classification:

    • D40 - Microeconomics - - Market Structure, Pricing, and Design - - - General
    • L11 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Production, Pricing, and Market Structure; Size Distribution of Firms

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