Uniqueness of Noncooperative Equilibria in a Trading Economy with Market Supply and Bidding Strategies.

L. VanDerHeyden

ResearchPublished 1977

An examination of the uniqueness of noncooperative equilibria in economic game theory. It is assumed that trading occurs in organized markets, with one of the commodities as a means of payment and with a bidding mechanism defined so as to always clear the market. An example demonstrates that uniqueness of the equilibria is too much to hope for in the general case. With a separability assumption on the utility functions of the agents of the economy, the author concludes that multiplicity is due to agents not bidding on certain goods or having their bids limited by their cash constraints. The author proves uniqueness when the utility functions are linear in the means of payment and loglinear in the other commodities, assuming that the agents are endowed with "enough" money and that there is no supply monopoly of any good. 18 pp. Ref.

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VanDerHeyden, L., Uniqueness of Noncooperative Equilibria in a Trading Economy with Market Supply and Bidding Strategies. Santa Monica, CA: RAND Corporation, 1977. https://www.rand.org/pubs/reports/R2186.html.
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