Bazaar economics

Michele Tumminello, John H. Miller, John H. Miller, John H. Miller, Michele Tumminello

Research output: Contribution to journalArticlepeer-review

1 Citation (Scopus)

Abstract

Competitive Equilibrium theory has been a widely accepted and extensively used cornerstone in economics for over a century. Here, we suggest a complementary model—motivated by the haggling in a bazaar—that offers a useful, first-principle account of market behavior that better accounts for the observed outcomes in forty market experiments. The Bazaar model uses simple stochastic processes to drive the matching of traders and the determination of price. We show that as agents become more impatient, the system tends toward more Competitive-Equilibrium-like outcomes.
Original languageEnglish
Pages (from-to)163-181
Number of pages19
JournalJOURNAL OF ECONOMIC BEHAVIOR & ORGANIZATION
Volume119
Publication statusPublished - 2015

All Science Journal Classification (ASJC) codes

  • Economics and Econometrics
  • Organizational Behavior and Human Resource Management

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