This website uses cookies.

By clicking the "Accept" button or continuing to browse our site, you agree to first-party and session-only cookies being stored on your device to enhance site navigation and analyze site performance and traffic. For more information on our use of cookies, please see our Privacy Policy.

  1. Home
  2. Journals
  3. American Economic Journal: Microeconomics
  4. November 2023
  5. Slope Takers in Anonymous Markets

Slope Takers in Anonymous Markets

  • Daniel Quint
  • Marek Weretka
American Economic Journal: Microeconomics
vol. 15, no. 4, November 2023
(pp. 306-18)
Download Full Text PDF

Abstract

We present a learning-based selection argument for Linear Bayesian Nash equilibrium in a Walrasian auction. Endowments vary stochastically; traders model residual supply as linear, estimate its slope from past trade data, and periodically update these estimates. In the standard setting with quadratic preferences, we show that this learning process converges to the unique LBN. Anonymity and statistical learning therefore support this commonly used equilibrium selection rule.

Citation

Quint, Daniel, and Marek Weretka. 2023. "Slope Takers in Anonymous Markets." American Economic Journal: Microeconomics, 15 (4): 306-18. DOI: 10.1257/mic.20220078

Additional Materials

JEL Classification

  • D43 Market Structure, Pricing, and Design: Oligopoly and Other Forms of Market Imperfection
  • D44 Auctions
  • D83 Search; Learning; Information and Knowledge; Communication; Belief; Unawareness
There are no comments for this article.
Login to Comment