Bilateral Trading Processes, Pairwise Optimality, and Pareto Optimality

Feldman, Allan M.

doi:10.1016/b978-0-12-663970-4.50011-6

Cited by 27 publications

(33 citation statements)

References 6 publications

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“…These features are at variance with transferable-utility pure exchange models [7], [8], [9], [14], [16]. Also noteworthy is that individual constraints can be general and criteria non-smooth.…”

Section: Links To Literaturementioning

confidence: 96%

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Reaching Cournot-Walras Equilibrium

Flåm

Gramstad

2017

ESAIM: ProcS

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Section: Links To Literaturementioning

confidence: 96%

“…• Attainment of equilibrium in exchange economies has long been studied; see [7], [8], [9], [14], [16] and references therein. A novelty here is that exchange is superimposed on non-cooperative production.…”

Section: Links To Literaturementioning

confidence: 99%

Reaching Cournot-Walras Equilibrium

Flåm

Gramstad

2017

ESAIM: ProcS

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“…negotiating deals that involve more than just two agents, however, is considerably more complex than the more widely studied bilateral trading. As pointed out by Feldman [11], − if the costs of arranging a multilateral deal were proportional to the number of pairs in a group of agents, then they would rise quadratically as the size of the group increases (because there are n · (n−1)/2 pairs in a group of n agents); and − if the costs were proportional to the number of subgroups in a group, then they would rise exponentially (because there are 2 n subgroups).…”

Section: Communication Complexitymentioning

confidence: 97%

On the Communication Complexity of Multilateral Trading: Extended Report

Endriss

Maudet

2005

Auton Agent Multi-Agent Syst

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Abstract. We study the complexity of a multilateral negotiation framework where autonomous agents agree on a sequence of deals to exchange sets of discrete resources in order to both further their own goals and to achieve a distribution of resources that is socially optimal. When analysing such a framework, we can distinguish different aspects of complexity: How many deals are required to reach an optimal allocation of resources? How many communicative exchanges are required to agree on one such deal? How complex a communication language do we require? And finally, how complex is the reasoning task faced by each agent?

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“…Money is introduced as a store of value and to facilitate trading. According to Feldman (1973), the presence of money in an Arrow-Debreu economy guarantees that bilateral trading suffices to reach pareto-efficiency, whereas in general, atomic trades involving three or more agents might be necessary.…”

Section: Agent-based Modelmentioning

confidence: 99%

An Agent-Based Simulation of the Stolper–Samuelson Effect

Meisser

Kreuser

2016

Comput Econ

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We demonstrate that agent-based simulations can exhibit results in line with classic macroeconomic theory. In particular, we present an agent-based simulation of an Arrow-Debreu economy that accurately exhibits the Stolper-Samuelson effect as an emergent property. Absent of a Walrasian auctioneer or any other central coordination, we let firm and consumer agents of different types interact in an open, money-driven market. Exogenous preference shocks result in price and wage shifts that are in accordance with the general equilibrium solution, not only qualitatively but also quantitatively with high accuracy. Key to this achievement are three independent measures. First, we overcome the poor input synchronization of conventional price finding heuristics of firms in agent-based models by introducing sensor prices, a novel approach to price finding that decouples information exploitation from information exploration. Second, we improve accuracy and convergence by employing exponential search as exploration algorithm. Third, we normalize prices indirectly by fixing dividends, thereby stabilizing the system's dynamics. Abstract We demonstrate that agent-based simulations can exhibit results in line with classic macroeconomic theory. In particular, we present an agentbased simulation of an Arrow-Debreu economy that accurately exhibits the Stolper-Samuelson effect as an emergent property. Absent of a Walrasian auctioneer or any other central coordination, we let firm and consumer agents of different types interact in an open, money-driven market. Exogenous preference shocks result in price and wage shifts that are in accordance with the general equilibrium solution, not only qualitatively but also quantitatively with high accuracy. Key to this achievement are three independent measures. First, we overcome the poor input synchronization of conventional price finding heuristics of firms in agent-based models by introducing sensor prices, a novel approach to price finding that decouples information exploitation from information exploration. Second, we improve accuracy and convergence by employing exponential search as exploration algorithm. Third, we normalize prices indirectly by fixing dividends, thereby stabilizing the system's dynamics.

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Bilateral Trading Processes, Pairwise Optimality, and Pareto Optimality

Cited by 27 publications

References 6 publications

Reaching Cournot-Walras Equilibrium

Reaching Cournot-Walras Equilibrium

On the Communication Complexity of Multilateral Trading: Extended Report

An Agent-Based Simulation of the Stolper–Samuelson Effect

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