Cover: Noncooperative General Exchange

Noncooperative General Exchange

Published 1974

by Lloyd S. Shapley

Download

Download eBook for Free

FormatFile SizeNotes
PDF file 2.1 MB

Use Adobe Acrobat Reader version 10 or higher for the best experience.

Purchase

Purchase Print Copy

 Format Price
Add to Cart Paperback43 pages $20.00

A game theoretic approach to the problem of monopolistic competition in a general exchange economy, taking account of the effect on prices that individual traders can have through their buy and sell decisions. A noncooperative game in strategic form is defined by designating one good as a "trading money" and letting the players use their initial stock of this good to make bids for the other goods. Prices are determined by dividing the total amount bid for each good by the total supply of that good. A diagrammatic analysis is presented based on the Edgeworth Box, and a number of variants are described that use the same basic bidding process for forming the trading prices. Two theorems are stated (but not proved in this paper) concerning the existence of Nash equilibrium points and their relationship to the competitive equilibrium in markets with many traders. (Presented at the April 1974 Conference on Externalities at Southern Illinois University at Edwardsville; to appear in the Proceedings.)

This report is part of the RAND paper series. The paper was a product of RAND from 1948 to 2003 that captured speeches, memorials, and derivative research, usually prepared on authors' own time and meant to be the scholarly or scientific contribution of individual authors to their professional fields. Papers were less formal than reports and did not require rigorous peer review.

This document and trademark(s) contained herein are protected by law. This representation of RAND intellectual property is provided for noncommercial use only. Unauthorized posting of this publication online is prohibited; linking directly to this product page is encouraged. Permission is required from RAND to reproduce, or reuse in another form, any of its research documents for commercial purposes. For information on reprint and reuse permissions, please visit www.rand.org/pubs/permissions.

RAND is a nonprofit institution that helps improve policy and decisionmaking through research and analysis. RAND's publications do not necessarily reflect the opinions of its research clients and sponsors.