Searching Market Equilibria under Uncertain Utilities

Kryazhimskiy AV, Nentjes A, Shibayev S, & Tarasyev AM (1998). Searching Market Equilibria under Uncertain Utilities. IIASA Interim Report. IIASA, Laxenburg, Austria: IR-98-007

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Abstract

Our basic model is a noncooperative multi-player game in which the governments of neighboring counties trade emission reductions. We prove the existence of a market equilibrium (combining properties of Pareto and Nash equilibria) and study algorithms of searching a market equilibrium. The algorithms are interpreted as repeated auctions in which the auctioneer has no information on countries' costs and benefits and every government has no information on the costs and benefits of other countries. In each round of the auction, the auctioneer offers individual prices for emission reductions and observes countries' best replies. We consider several auctioneer's policies and provide conditions that guarantee approaching a market equilibrium. From a game-theoretical point of view, the repeated auction describes a process of learning in a noncooperative repeated game with incomplete information.

Item Type: Monograph (IIASA Interim Report)
Research Programs: Dynamic Systems (DYN)
Depositing User: IIASA Import
Date Deposited: 15 Jan 2016 02:10
Last Modified: 23 Oct 2016 09:29
URI: http://pure.iiasa.ac.at/5639

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