Econometrica Vol. 45 No. 4 1977
A Two-Person Exchange Model
Abstract
This paper deals with a situation of middle-man behavior between two otherwise separated economies. A two-person noncooperative exchange game is proposed whereby each player's strategy consists of two parts taken in a sequence: a price strategy, to be followed by a demand strategy. The concept of a special kind of mixed strategies is introduced, and a solution is defined in terms of a Nash equilibrium pair of such mixed strategies. It is shown that a trivial class of equilibria always exists, and that under certain conditions, more interesting nontrivial equilibria can exist as well.
- DOI
- 10.2307/1912675
- Volume
- 45
- Issue
- 4
- Pages
- 843
- Sources
- bibtex:phds-export.bib crossref openalex