The Fisher Market Game: Equilibrium and Welfare
The Fisher Market Game: Equilibrium and Welfare
The Fisher market model is one of the most fundamental resource allocation models in economics. In a Fisher market, the prices and allocations of goods are determined according to the preferences and budgets of buyers to clear the market. In a Fisher market game, however, buyers are strategic and report their preferences over goods; the market-clearing prices and allocations are then determined based on their reported preferences rather than their real preferences. We show that the Fisher market game always has a pure Nash equilibrium, for buyers with linear, Leontief, and Cobb-Douglas utility functions, which are three representative classes of utility functions in the important Constant Elasticity of Substitution (CES) family. Furthermore, to quantify the social efficiency, we prove Price of Anarchy bounds for the game when the utility functions of buyers fall into these three classes respectively.
587-593
Branzei, Simina
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Chen, Yiling
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Deng, Xiaotie
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Filos-Ratsikas, Aris
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Frederiksen, Soren Kristoffer Stiil
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Zhang, Jie
21de2303-4727-4097-9b0f-ae43d95d052a
2014
Branzei, Simina
e9d04e42-7da9-43be-8a81-9164c4368511
Chen, Yiling
b558c113-9655-423d-827d-77704dead39a
Deng, Xiaotie
772c0705-a735-43dc-8988-f5c527572574
Filos-Ratsikas, Aris
14e554b2-bc6b-4b2c-a84d-8650ad4bed14
Frederiksen, Soren Kristoffer Stiil
3e896a21-0be0-4102-895d-2370e32c28ae
Zhang, Jie
21de2303-4727-4097-9b0f-ae43d95d052a
Branzei, Simina, Chen, Yiling, Deng, Xiaotie, Filos-Ratsikas, Aris, Frederiksen, Soren Kristoffer Stiil and Zhang, Jie
(2014)
The Fisher Market Game: Equilibrium and Welfare.
In Twenty-Eighth AAAI Conference on Artificial Intelligence.
AAAI Press.
.
Record type:
Conference or Workshop Item
(Paper)
Abstract
The Fisher market model is one of the most fundamental resource allocation models in economics. In a Fisher market, the prices and allocations of goods are determined according to the preferences and budgets of buyers to clear the market. In a Fisher market game, however, buyers are strategic and report their preferences over goods; the market-clearing prices and allocations are then determined based on their reported preferences rather than their real preferences. We show that the Fisher market game always has a pure Nash equilibrium, for buyers with linear, Leontief, and Cobb-Douglas utility functions, which are three representative classes of utility functions in the important Constant Elasticity of Substitution (CES) family. Furthermore, to quantify the social efficiency, we prove Price of Anarchy bounds for the game when the utility functions of buyers fall into these three classes respectively.
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The Fisher Market Game Equilibrium and Welfare
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e-pub ahead of print date: 21 June 2014
Published date: 2014
Organisations:
Agents, Interactions & Complexity
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Local EPrints ID: 402583
URI: http://eprints.soton.ac.uk/id/eprint/402583
PURE UUID: 77bb997d-3eeb-4848-8527-5d0b8c3e2231
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Date deposited: 29 Nov 2016 09:43
Last modified: 15 Mar 2024 19:36
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Contributors
Author:
Simina Branzei
Author:
Yiling Chen
Author:
Xiaotie Deng
Author:
Aris Filos-Ratsikas
Author:
Soren Kristoffer Stiil Frederiksen
Author:
Jie Zhang
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