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Learning competitive market balance

We exhibit a quite natural, adaptive process generated by price-taking, noncooperative firms, supplying the same market. Under rather mild conditions, that process, being driven by marginal profits, converges to a market clearing, Cournot-Nash equilibrium. Namely, it suffices for convergence that cost functions be strictly convex and that the law of demand holds. Randomness in revenues and costs is accommodated.
Year of publication:
1997-11-09
Authors: FlÅm, Sjur Didrik
Published in:
Economic Theory. - Springer. - Vol. 6.1995, 3, p. 511-518
Publisher: Springer
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Type of publication: Article
Notes:
Received: January 4, 1994; revised version February 23, 1994
Source:
Persistent link: https://www.econbiz.de/10005371069
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