Bargaining and markets: complexity and the competitive outcome

• 成果类型: Article
• 署名作者: Sabourian, H
• 署名单位: University of Cambridge
• 刊物名称: JOURNAL OF ECONOMIC THEORY
• ISSN/ISSBN: 0022-0531
• DOI: 10.1016/j.jet.2003.08.003
• 发表日期: 2004
• 页码: 189-228
• 关键词: Bargaining; matching; complexity; automaton; bounded rationality; Markov equilibrium; competitive equilibrium

摘要

Rubinstein and Wolinsky (Rev. Econ. Stud. 57 (1990) 63-78) consider a simple decentralised market game in which agents meet randomly or voluntarily and bargain over the terms of trade. They show that any individually rational price can be sustained as a sequential equilibrium even though the model has a unique competitive outcome. Here, I consider Rubinstein and Wolinsky's model and show that if complexity costs of implementing strategies enter players' preferences, together with the standard payoff in the game, then every equilibrium is stationary/Markov and induces the unique competitive price. Thus, I demonstrate that aversion to complexity may provide a justification for the competitive outcome. (C) 2003 Elsevier Inc. All rights reserved.