“walrasian auction”

“wall RAY jin”

*rhymes with “ASIAN”*

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*a walrasian auction – introduced by ‘Léon Walras’ – is a type of ‘simultaneous auction’ where each ‘agent’ calculates its ‘demand’ for the ‘good’ at every possible ‘price’ and submits this to an ‘auctioneer’*

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The price is then set so that the total demand across all agents equals the total amount of the good.

Thus, a Walrasian auction perfectly matches the supply and the demand.

Walras suggested that equilibrium would always be achieved through a process of tâtonnement (French for “trial and error”), a form of hill climbing.

More recently, however, the Sonnenschein–Mantel–Debreu theorem proved that such a process would not necessarily reach a unique and stable equilibrium, even if the market is populated with perfectly rational agents

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*👨‍🔬🕵️‍♀️🙇‍♀️*SKETCHES*🙇‍♂️👩‍🔬🕵️‍♂️*

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🔥🔥🔥🔥🔥🔥*we won the war* 🔥🔥🔥🔥🔥🔥