Self-Organization of Markets: An Example of a Computational Approach.

A model of decentralized trade is simulated with firms that produce a given commodity, and consumers who repeatedly wish to purchase one unit of that commodity. Consumers 'shop around,' while firms may attract the attention of potential customers by sending information signals and offering good service. The main objective of this paper is to present an example of computational approach to address the following question: How do self-organized markets emerge in the economy, and what are their characteristics? Citation Copyright 1995 by Kluwer Academic Publishers.