Matching and bargaining models of markets: approximating small markets by large markets

We show that the equilibrium of a matching and bargaining model of a market in which there is a finite number of agents at each date need not be near the equilibrium of a market with a continuum of agents, although matching probabilities are the same in both markets. Holding the matching process fixed, as the finite market becomes large its equilibrium approaches the equilibrium of its continuum limit.

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Year of publication:	1997-11-17
Authors:	Wooders, John
Published in:	Economic Theory. - Springer. - Vol. 11.1997, 1, p. 215-224
Publisher:	Springer

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Extent:	application/pdf application/postscript
Type of publication:	Article
Notes:	Received: January 22, 1996; revised version: September 24, 1996
Classification:	C73 - Stochastic and Dynamic Games ; C78 - Bargaining Theory; Matching Theory
Source:	RePEc - Research Papers in Economics

Persistent link: https://www.econbiz.de/10005753415