Convergence of Double Auctions to Pareto Optimal Allocations in the Edgeworth Box
Double auctions with profit-motivated human traders as well as "zero-intelligence" programmed traders have previously been shown to converge to Pareto optimal allocations in partial equilibrium settings. We show that these results remain robust in two-good general equilibrium settings and elucidate how market structure, not optimization by traders, guides efficient resource allocation.
|Date of creation:||01 Jun 2004|
|Date of revision:||01 Apr 2008|
|Contact details of provider:|| Web page: http://icf.som.yale.edu/|
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- Antoni Bosch-Domenech & Shyam Sunder, 2000. "Tracking the Invisible Hand: Convergence of Double Auctions to Competitive Equilibrium," Computational Economics, Springer;Society for Computational Economics, vol. 16(3), pages 257-284, December.
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University of Chicago Press, vol. 70, pages 111-111.
- Vernon L. Smith, 1962. "An Experimental Study of Competitive Market Behavior," Journal of Political Economy, University of Chicago Press, vol. 70, pages 322-322.
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