The evolution of exchange |
| |
Authors: | Assaf Ben-Shoham Oscar Volij |
| |
Institution: | a Department of Economics, Harvard University, Cambridge, MA 02138, USA b Department of Economics, Brown University, Providence, RI 02912, USA c Department of Economics, Iowa State University, Ames, IA 50011-1070, USA |
| |
Abstract: | Stochastic stability is applied to the problem of exchange. We analyze the stochastic stability of two dynamic trading processes in a simple housing market. In both models, traders meet in pairs at random and exchange their houses when trade is mutually beneficial, but occasionally they make mistakes. The models differ in the probability of mistakes. When all mistakes are equally likely, the set of stochastically stable allocations contains the set of efficient allocations. When more serious mistakes are less likely, the stochastically stable states are those allocations, always efficient, with the lowest envy level. |
| |
Keywords: | C7 D51 D61 D63 |
本文献已被 ScienceDirect 等数据库收录! |
|