Skip navigation

Convergence of Double Auctions to Pareto Optimal Allocations in the Edgeworth Box

Authors: Gode, Dhananjay (Dan) K.
Sunder, Shyam
Keywords: Pareto optimal allocations;Edgeworth Box;Double auction;Zero-intelligence traders
Issue Date: May-2004
Series/Report no.: Dhananjay (Dan) K. Gode-09
Abstract: Double auctions with profit-motivated human traders as well as "zero-intelligence" programmed traders have previously been shown to converge to Pareto optimal allocations in partial equilibrium settings. We show that these results remain robust in two-good general equilibrium settings and elucidate how market structure, not optimization by traders, guides efficient resource allocation.
Appears in Collections:Accounting Working Papers

Files in This Item:
File Description SizeFormat 
SSRN-id555862.pdf312.46 kBAdobe PDFView/Open

Items in FDA are protected by copyright, with all rights reserved, unless otherwise indicated.