Skip to content

Research at St Andrews

Stability and competitive equilibrium in trading networks

Research output: Contribution to journalArticle

DOI

Open Access permissions

Open

Author(s)

John William Hatfield, Scott Duke Kominers, Alexandru Nichifor, Michael Ostrovsky, Alexander Westkamp

School/Research organisations

Abstract

We introduce a model in which agents in a network can trade via bilateral contracts. We find that when continuous transfers are allowed and utilities are quasilinear, the full substitutability of preferences is sufficient to guarantee the existence of stable outcomes for any underlying network structure. Furthermore, the set of stable outcomes is essentially equivalent to the set of competitive equilibria, and all stable outcomes are in the core and are efficient. By contrast, for any domain of preferences strictly larger than that of full substitutability, the existence of stable outcomes and competitive equilibria cannot be guaranteed.
Close

Details

Original languageEnglish
Pages (from-to)966-1005
Number of pages40
JournalJournal of Political Economy
Volume121
Issue number5
DOIs
Publication statusPublished - Oct 2013

Discover related content
Find related publications, people, projects and more using interactive charts.

View graph of relations

Related by journal

  1. Redistributing income under proportional representation: a correction

    Morelli, M. & Negri, M., 4 Jan 2019, In : Journal of Political Economy. Ahead of Print, 5 p.

    Research output: Contribution to journalArticle

ID: 74151186