SFB 303 Discussion Paper No. A - 43

Author: Berninghaus, Siegfried
Title: Price Adjustment Processes with Adaptively Price Setting Firms
Abstract: The paper represents an extension of the theory of price adjustment processes without an auctioneer where the consumers are incompletely informed about market prices and firms are incompletely informed about there own firm specific demand functions. Firms are supposed to apply a general stochastic price adjustment rule and consumers are supposed to apply a general price search rule. It can be demonstrated under these conditions that the resulting stochastic price adjustment process is a special case of a so called "Generalized Random System with Complete Connections" whose convergence results are utilized for our economic adjustment process.
Creation-Date: March 1986
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