On Some Bilateral Exchange Method and Its Dynamics

Abstract

This presentation is devoted to the study of whether or not a bilateral trading process which is recently proposed by Gintis (2007) can converge to a general equilibrium price as Gintis has asserted in his paper. Gintis assumed to have their private prices initially which are distributed uniformly, and as trading goes on, each agent tries to imitate the private price of some other agent whose utility will be larger than his own utility. His assertion is that according as transactions proceed, the average of distribution of transaction prices tends to approach a general equilibrium price. However, our presentation asserts that his assertion is not necessarily true.