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http://hdl.handle.net/10016/361
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| we056433.pdf | -- 2006-11-09 -- Available on Internet -- preprint | 183,71 kB | Adobe PDF | |  |
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| Title: | Decentralized trade, random utility and the evolution of social welfare |
| Author(s): | Kandori, Michihiro
Serrano, Roberto
Volij, Oscar |
| Issued date: | Nov-2005 |
| URI: | http://hdl.handle.net/10016/361 |
| Abstract: | We study decentralized trade processes in general exchange economies and house allocation problems with and without money. The processes are subject to persistent random shocks stemming from agents' maximization of random utility. By imposing structure on the utility noise term -logit distribution-, one is able to calculate exactly the stationary distribution of the perturbed Markov process for any level of noise. We show that the stationary distribution places the largest probability on the maximizers of weighted sums of the agents' (intrinsic) utilities, and this probability tends to 1 as noise vanishes |
| Serie / Nº.: | UC3M Working Paper. Economics
2005-33 |
| Appears in Collections: | Economists Online
DE - Working Papers. Economics. WE
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