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Concurrent trading in two experimental markets with demand interdependence

Williams, Arlington W. and Smith, Vernon L. and Ledyard, John O. and Gjerstad, Steven (2001) Concurrent trading in two experimental markets with demand interdependence. In: Advances in Experimental Markets. Studies in Economic Theory. No.15. Springer , Berlin, pp. 15-32. ISBN 978-3-642-62657-9. https://resolver.caltech.edu/CaltechAUTHORS:20200512-094205367

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Abstract

We report results from fifteen computerized double auctions with concurrent trading of two commodities. In contrast to prior experimental markets, buyers’ demands are induced via CES earnings functions defined over the two traded goods, with a fiat money expenditure constraint. Sellers receive independent marginal cost arrays for each commodity. Parameters for buyers” earnings functions and sellers’ costs are set to yield a stable, competitive equilibrium. In spite of the complexity introduced by the demand interdependence, the competitive model is a good predictor of market outcomes, although prices tend to be above (below) the competitive prediction in the low-price (high-price) market.


Item Type:Book Section
Related URLs:
URLURL TypeDescription
https://doi.org/10.1007/978-3-642-56448-2_2DOIArticle
Additional Information:© 2001 Springer-Verlag Berlin Heidelberg.
Subject Keywords:Induced utility; General equilibrium; Double auction
Series Name:Studies in Economic Theory
Issue or Number:15
Classification Code:JEL: C92; D44; D51; D83
Record Number:CaltechAUTHORS:20200512-094205367
Persistent URL:https://resolver.caltech.edu/CaltechAUTHORS:20200512-094205367
Usage Policy:No commercial reproduction, distribution, display or performance rights in this work are provided.
ID Code:103130
Collection:CaltechAUTHORS
Deposited By: Tony Diaz
Deposited On:12 May 2020 18:57
Last Modified:12 May 2020 18:57

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