Preferences analysis, transactions, and volatility

Purpose – The reasons for writing the paper are flexibility of information under multi‐agent approach. Design/methodology/approach – The main method used for the research is preferences in environment and matching of information. Findings – The benefits of hierarchy flow from the fact that it attenuates opportunism and attenuates the problem stemming from bounded rationality. The preference of an agent over sets of possible future choices can be represented using subjective states. This is sufficient to give a representation in which the agent has a coherent subjective state space, and shows that the size of the subjective state space depends on the individual circumstances. Originality/value – The original value of the paper is a measure of the agent's uncertainty about future contingents. Changes in the surplus yield valuable information about the comparative static of matching patterns across environments in equilibrium.