Noncooperative exchange with a continuum of traders

by Pradeep Dubey, Lloyd S. Shapley

Purchase Print Copy

 FormatList Price Price
Add to Cart Paperback41 pages $23.00 $18.40 20% Web Discount

Price formation and trade in a large exchange economy is modeled as a nonatomic noncooperative game in two contrasting ways: (1) with fiat money, with borrowing and bankruptcy permitted, and (2) with a commodity money and no borrowing. Results relating the noncooperative (Nash) equilibrium with the competitive (Walrus) equilibrium are obtained for each model, and some special cases are considered. The basic problem of measurability of the strategy selection when there is a continuum of players is also considered, and way of resolving it is proposed.

This report is part of the RAND Corporation paper series. The paper was a product of the RAND Corporation 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.

The RAND Corporation 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.