A Remark on the Number of Trading Posts in Strategic Market Games
نویسنده
چکیده
In market games the one to one correspondence between commodity types and trading posts would be justified if it were true that the set of equilibria is not affected by the number of trading posts postulated at the outset of the model. We show that this is not true. We develop an example which features equilibria where a commodity is simultaneously exchanged in two trading posts at different prices, i.e., equilibria where the ’law of one price’ fails when the one to one correspondence between commodities and trading posts is abandoned. Thus, we conclude that the set of equilibria in market games depends non-trivially on the number of trading posts. This conclusion further suggests that an explanation of the structure of trading posts is necessary.
منابع مشابه
Market Games with Multiple Trading Posts
We study market games with multiple posts per commodity. We provide some facts that characterize prices of commodities across posts and show the following results: (i) As the number of agents increases, the price variability across posts for a commodity becomes smaller and it becomes zero when the number of agents becomes infinite, irrespectively of the distribution of characteristics in the ec...
متن کاملStrategic confrontation within monetary and financial authorities, and foreign exchange market participants in Iran: non-cooperative static games approach
The experience of large fluctuations in the Foreign Exchange Market in Iran and the impact of monetary and fiscal policies on this market revealed the importance of adopting a scientific approach by fiscal and monetary policymakers and paying attention to the behavior of other actors (Foreign Exchange Speculators) in the decision-making. The present study tries to evaluate the Social Loss of ad...
متن کاملDynamic system of strategic games
Maybe an event can't be modeled completely through one game but there is more chance with several games. With emphasis on players' rationality, we present new properties of strategic games, which result in production of other games. Here, a new attitude to modeling will be presented in game theory as dynamic system of strategic games and its some applications such as analysis of the clash betwe...
متن کاملIdentifying Information in Stock Message Boards and Its Implications for Stock Market Efficiency
The information value of stock message boards has often been debated. A main difficulty in assessing the value is the presence of a large number of posts with varying quality. This paper presents an intuitive approach to identify and aggregate information in stock message boards. We weigh each post’s recommendation by its author’s credibility based on accuracy of his past posts. We find that th...
متن کاملIs It Necessary to Restrict Forex Financial Trading? A Modified Model
The Central Bank of Iran banned online currency trading through Forex brokers in November 2016. However, some Iranian speculators still trade in the online Forex market. Is this prohibition on Forex trading reasonable? According to reports, the majority of Forex day traders fail and leave the market within six months to a year. Some scholars attribute this failure to the changeable characterist...
متن کامل