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Title:Adjusting prices in the many-to-many assignment game PDF Logo
Authors:Sotomayor, Marilda
Issue Date:2008
Series/Report no.:Working Paper, Brown University, Department of Economics 2008-13
Abstract:Starting with an initial price vector, prices are adjusted in order to eliminate the demand excess and at the same time to keep the transfers to the sellers as low as possible. In each step of the auction, to which sellers should those transfers be made (minimal overdemanded sets) is the key definition in the description of the algorithm. Such approach was previously used by several authors. We introduce a novel distinction by considering multiple sellers owing multiple identical objects and multiple buyers with a quota greater than one consuming at most one unit of each seller's good. This distinction induces a necessarily more complicated construction of the overdemanded sets than the constructions existing in the literature, even in the simplest case of additive utilities considered here. As the previous papers, our mechanism yields the minimum competitive equilibrium price vector. A procedure to find the maximum competitive equilibrium price vector is also provided.
Subjects:matching
stable payoff
competitive equilibrium payoff
optimal stable payoff
lattice
JEL:C78
D78
Document Type:Working Paper
Appears in Collections:Working Papers, Department of Economics, Brown University

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