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Learning Competitive Market Balance
Sjur Didrik Flåm
Vol. 6, No. 3 (Nov., 1995), pp. 511-518
Published by: Springer
Stable URL: http://www.jstor.org/stable/25054895
Page Count: 8
You can always find the topics here!Topics: Economic theory, Prices, Measurability, Marginal costs, Supply, Market prices, Aggregate supply, Marginal cost pricing, Mathematical monotonicity, Variational inequalities
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We exhibit a quite natural, adaptive process generated by price-taking, noncooperative firms, supplying the same market. Under rather mild conditions, that process, being driven by marginal profits, converges to a market clearing, Cournot-Nash equilibrium. Namely, it suffices for convergence that cost functions be strictly convex and that the law of demand holds. Randomness in revenues and costs is accommodated.
Economic Theory © 1995 Springer