Faculty Digital Archive

Archive@NYU >
Stern School of Business >
Accounting Working Papers >

Please use this identifier to cite or link to this item: http://hdl.handle.net/2451/27484

Title: Double Auction Dynamics: Structural Effects Of Non-Binding Price Controls
Authors: Gode, Dhanajay K.
Sunder, Shyam
Keywords: Price Controls
Zero-Intelligence
Double Auction Dynamics
Allocative Efficiency
Issue Date: May-2003
Series/Report no.: Dhananjay (Dan) K. Gode-07
Abstract: In competitive equilibrium, non-binding price controls (that is, price floors below and ceilings above the equilibrium) should not affect market outcomes, but in laboratory experiments they do. We build a simple dynamic model of double auction markets with "zero-intelligence" (ZI) computer traders that accounts for many, though not all, of the discrepancies between the data and the Walrasian tatonnement predictions. The success of the model in organizing the data, and in isolating various consequences of price controls, shows that the simple ZI model is a powerful tool to gain insights into the dynamics of market institutions.
URI: http://hdl.handle.net/2451/27484
Appears in Collections:Accounting Working Papers

Files in This Item:

File Description SizeFormat
SSRN-id219068.pdf525.48 kBAdobe PDFView/Open

Items in Faculty Digital Archive are protected by copyright, with all rights reserved, unless otherwise indicated.

 

The contents of the FDA may be subject to copyright, be offered under a Creative Commons license, or be in the public domain.
Please check items for rights statements. For information about NYU’s copyright policy, see http://www.nyu.edu/footer/copyright-and-fair-use.html 
Valid XHTML 1.0 | CSS