Journal of Convex Analysis 30 (2023), No. 3, 937--950
Copyright Heldermann Verlag 2023
By Bid-Ask Spreads towards Competitive Equilibrium
Sjur Didrik Flam
University of Bergen, Norway
Consider agents who just use markets and money to mediate trade and express economic interests. Suppose bid-ask spreads -- derived from generalized differentials -- drive and incite transactions. On that basis, this paper indicates good prospects for convergence towards competitive equilibrium.
Presuming private property, main arguments hinge on three hooks: First, Fenchel conjugation to record profits or values added; second, aggregate convexity to support Pareto efficiency by prices; and third, absence of externalities to make total additions of value dwindle step by step.
Keywords: Conjugation, convexity, competitive equilibrium.
MSC: 90C25, 91B24, 91B50.
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