Related papers: Spontaneous Economic Order
We introduce a simple framework in which market participants update their prior about an efficient price with a model-based learning process. We show that exponential intensities for the arrival of aggressive orders arise naturally in this…
In large scale collective decision making, social choice is a normative study of how one ought to design a protocol for reaching consensus. However, in instances where the underlying decision space is too large or complex for ordinal…
We propose a model for a market which structure is of the tree form. Each branch of the tree is composed by identical firms, its root (the branch of the first level) is formed by the firms producing raw material, and the branches of the…
This paper presents karma mechanisms, a novel approach to the repeated allocation of a scarce resource among competing agents over an infinite time. Examples include deciding which ride hailing trip requests to serve during peak demand,…
Gallice and Monz\'on (2019) present a natural environment that sustains full co-operation in one-shot social dilemmas among a finite number of self-interested agents. They demonstrate that in a sequential public goods game, where agents…
We design a simple ascending-price algorithm to compute a $(1+\varepsilon)$-approximate equilibrium in Arrow-Debreu exchange markets with weak gross substitute (WGS) property, which runs in time polynomial in market parameters and $\log…
We consider an elementary discrete process which starts from purely random configuration and leads to well-ordered and stable state. Complete analytical solution to this problem is presented.
Here we provide a detailed analysis, along with some extensions and additonal investigations, of a recently proposed self-organised model for the evolution of complex networks. Vertices of the network are characterised by a fitness variable…
The paper analyses trade between the most developed economies of the world. The analysis is based on the previously proposed model of international trade. This model of international trade is based on the theory of general economic…
A version of the second order phase transition theory, in which the Nernst theorem holds automatically, is proposed. The theory is constructed in terms of the order parameter and the (configurational) entropy. It faithfully reproduces the…
Platform giants in China have operated with persistently compressed margins in highly concentrated markets for much of the past decade, despite market shares exceeding 60\% in core segments. Standard theory predicts otherwise: either the…
We study the design of optimal incentives in sequential processes. To do so, we consider a basic and fundamental model in which an agent initiates a value-creating sequential process through costly investment with random success. If…
Symmetries naturally occur in real-world networks and can significantly influence the observed dynamics. For instance, many synchronization patterns result from the underlying network symmetries, and high symmetries are known to increase…
This paper analyzes a steady state matching model interrelating the education and labor sectors. In this model, a heterogeneous population of students match with teachers to enhance their cognitive skills. As adults, they then choose to…
We consider a simple variant of the von Neumann model of an expanding economy, in which multiple producers make goods according to their production function. The players trade their goods at the market and then use the bundles acquired for…
Self-organization is frequently observed in active collectives, from ant rafts to molecular motor assemblies. General principles describing self-organization away from equilibrium have been challenging to identify. We offer a unifying…
According to the fundamental theorems of welfare economics, any competitive equilibrium is Pareto efficient. Unfortunately, competitive equilibrium prices only exist under strong assumptions such as perfectly divisible goods and convex…
Recent literature on computational notions of fairness has been broadly divided into two distinct camps, supporting interventions that address either individual-based or group-based fairness. Rather than privilege a single definition, we…
In this paper, I endeavour to construct a new model, by extending the classic exogenous economic growth model by including a measurement which tries to explain and quantify the size of technological innovation ( A ) endogenously. I do not…
Standard micro-economics concentrate on the description of markets but is seldom interested in production. Several economists discussed the concept of a firm, as opposed to an open labour market where entrepreneurs would recrute workers on…