Regensburg 2002 – scientific programme
Parts | Days | Selection | Search | Downloads | Help
AKSOE: Physik sozio-ökonomischer Systeme
AKSOE 20: Mikro-ökonomische Modelle und Multi-Agenten-Systeme
AKSOE 20.4: Talk
Thursday, March 14, 2002, 17:30–18:00, H8
Dynamic Market Simulations — •Kai Nagel1, Martin Strauss1, and Martin Shubik2 — 1Computer Science, ETH Zurich — 2Cowles Foundation for Economics Research, Yale University
Traditionally, economics theory assumes the invisible hand to set prices such that markets are cleared. We define instead a collection of agents plus dynamic rules for them. Agents produce, trade, and consume, and they have a utility function, which specifies the amount of utility from consumption of each good and the amount of disutility from working. The agent’s strategies consist of setting the price for their good, and specifying the amounts they buy from others. Agents perform a very simple “trial-and- error” evolution of their strategies. We show via simulations that in general such a simple set-up converges towards the Nash equilibrium solution, that however the adaptive mechanism can add fluctuations which can be of order N depending on the functional form of the utility function.