Economics, Econometrics and Finance
8 years ago

Strategic commodity exchange leads to suboptimal welfare in competitive markets.

Research in Economics
Nash–Walras equilibria
Sayantan Ghosal, H. M. Polemarchakis

Paper Summary

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At Nash–Walras equilibria, people trade goods competitively and strategically. These equilibria exist under certain conditions, with actions typically being clear but not the best for everyone. Simply transferring money doesn't always make things better for everyone.