Finding a walrasian equilibrium is easy for a fixed number of agents
Federico Echenique, Adam Wierman
Abstract
Federico Echenique, Adam Wierman
Abstract
In this work, we study the complexity of finding a Walrasian equilibrium. Our main result gives an algorithm which can compute an approximate Walrasian equilibrium in an exchange economy with general, but well-behaved, utility functions in time that is polynomial in the number of goods when the number of agents is held constant. This result has applications to macroeconomics and finance, where applications of Walrasian equilibrium theory tend to deal with many goods but a fixed number of agents.
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In this work, we study the complexity of finding a Walrasian equilibrium. Our main result gives an algorithm which can compute an approximate Walrasian equilibrium in an exchange economy with general, but well-behaved, utility functions in time that is polynomial in the number of goods when the number of agents is held constant. This result has applications to macroeconomics and finance, where applications of Walrasian equilibrium theory tend to deal with many goods but a fixed number of agents.
Key concepts: General equilibrium theory, Walrasian auction, Mathematical economics, Work (physics), Time complexity, Computer science, Mathematical optimization, Economics