2010/01/01 by Bharat Adsul, Ch. Sobhan Babu, Jugal Garg +2
Business, Management and Accounting · Computer Science · Decision Sciences · Economics, Econometrics and Finance · Mathematics · #Computer science #Consumer Market Behavior and Pricing #Economic theories and models #Game Theory and Applications #Mathematical economics #Mathematics #Nash equilibrium #cs.GT
paper · pdf · doi:10.1007/978-3-642-16170-4_4
openalex publication_date 2010/01/01 · arxiv created 2010/05/11 · arxiv updated 2015/05/18 · openalex created_date 2025/10/10 · openalex updated_date 2026/08/05
Much work has been done on the computation of market equilibria. However due to strategic play by buyers, it is not clear whether these are actually observed in the market. Motivated by the observation that a buyer may derive a better payoff by feigning a different utility function and thereby manipulating the Fisher market equilibrium, we formulate the \em Fisher market game in which buyers strategize by posing different utility functions. We show that existence of a \em conflict-free allocation is a necessary condition for the Nash equilibria (NE) and also sufficient for the symmetric NE in this game. There are many NE with very different payoffs, and the Fisher equilibrium payoff is captured at a symmetric NE. We provide a complete polyhedral characterization of all the NE for the two-buyer market game. Surprisingly, all the NE of this game turn out to be symmetric and the corresponding payoffs constitute a piecewise linear concave curve. We also study the correlated equilibria of this game and show that third-party mediation does not help to achieve a better payoff than NE payoffs.