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A Characterisation of Trading Equilibria in Strategic Market Games

Author

Listed:
  • Mitra, Manipushpak

    (Economic Research Unit, Indian Statistical Institute)

  • Ray, Indrajit

    (Cardiff Business School, Cardiff University)

  • Roy, Souvik

    (Applied Statistics Unit, Indian Statistical Institute)

Abstract

For a strategic market game (as introduced by Shapley and Shubik), following Dubey and Rogawski (1990), we provide a full explicit characterisation of the set of trading equilibria (in which all goods are traded at a positive price), for both the “buy and sell†and the “buy or sell†versions of this model under standard assumptions on the utility functions. We interpret and illustrate our equilibrium-characterising conditions; we also provide simple examples of trading equilibria, including those of non-interior strategy profiles (in which at least one trader is using the whole endowment in at least one good or money).

Suggested Citation

  • Mitra, Manipushpak & Ray, Indrajit & Roy, Souvik, 2024. "A Characterisation of Trading Equilibria in Strategic Market Games," CRETA Online Discussion Paper Series 83, Centre for Research in Economic Theory and its Applications CRETA.
    • Handle: RePEc:wrk:wcreta:83
    as

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    File URL: https://warwick.ac.uk/fac/soc/economics/research/centres/creta/papers/manage/creta83_-_indrajit_ray.pdf
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    References listed on IDEAS

    as
    1. Peck, James & Shell, Karl & Spear, Stephen E., 1992. "The market game: existence and structure of equilibrium," Journal of Mathematical Economics, Elsevier, vol. 21(3), pages 271-299.
    2. Ray, Indrajit, 2001. "Buying and selling in strategic market games," Economics Letters, Elsevier, vol. 71(1), pages 49-53, April.
    3. Dmitry Levando, 2012. "A Survey Of Strategic Market Games," Economic Annals, Faculty of Economics and Business, University of Belgrade, vol. 57(194), pages 63-106, July - Se.
    4. Shapley, Lloyd S & Shubik, Martin, 1977. "Trade Using One Commodity as a Means of Payment," Journal of Political Economy, University of Chicago Press, vol. 85(5), pages 937-968, October.
    5. repec:dau:papers:123456789/4099 is not listed on IDEAS
    6. Dubey, Pradeep & Shubik, Martin, 1977. "Trade and Prices in a Closed Economy with Exogeneous Uncertainty, Different Levels of Information, Money and Compound Futures Markets," Econometrica, Econometric Society, vol. 45(7), pages 1657-1680, October.
    7. Alex Dickson & Simone Tonin, 2021. "An introduction to perfect and imperfect competition via bilateral oligopoly," Journal of Economics, Springer, vol. 133(2), pages 103-128, July.
    8. Okuno, Masahiro & Postlewaite, Andrew & Roberts, John, 1980. "Oligopoly and Competition in Large Markets," American Economic Review, American Economic Association, vol. 70(1), pages 22-31, March.
    9. Alex Dickson, 2013. "On Cobb-Douglas Preferences in Bilateral Oligopoly," Recherches économiques de Louvain, De Boeck Université, vol. 79(4), pages 89-110.
    10. Giraud, Gael, 2003. "Strategic market games: an introduction," Journal of Mathematical Economics, Elsevier, vol. 39(5-6), pages 355-375, July.
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    More about this item

    Keywords

    strategic market game ; trading equilibrium ; interior profile ; buy and sell ; buy or sell JEL codes: C72 ; D44;
    All these keywords.

    JEL classification:

    • C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
    • D44 - Microeconomics - - Market Structure, Pricing, and Design - - - Auctions

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