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A market is an institutional arrangement that allows buyers and sellers to exchange goods, services, or information in transactions with or without money.

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Is there an economic theory that explains what happens when a market is saturated with a precious resource?

The theoretical situation is this. What if a record breaking amount of platinum were discovered. What would happen to the economies that use, store, and/or produce platinum? I would like to apply ...
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62 views

Auction mechanism with no trusted third-party

I have been using a double-auction mechanism to solve a two-sided market where multiple agents are competing to supply/use slices of a shared resource. The owner of the resource is a trustable third-...
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33 views

Two-sided market and bargaining game

I am solving a bargaining problem in which I have two players $player_1 $ and $ player_2 $. Both of them have a service (represented as $ z_1 ,z_2 $) that they can provide . Moreover they will ...
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42 views

Are stock exchanges market makers?

Are stock exchanges like NASDAQ and NYSE market makers? In other words, are they providing liquidity by pairing individual buyers and sellers with each other in real-time? Or does it work differently?
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17 views

Are corporations free market on the outside and communist dictatorships on the inside?

See why we hate working for big companies What do you think of the proposition that Modern capitalism raises the flag of the free market while pitting centrally planned organisations against each ...
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13 views

Predicting GDP contribution from market share

I want to find the GDP share of several companies, but I have their market share. Now we know that these two are not equal, and the market share to GDP ratio represents general overvaluation or ...
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69 views

Stock vs flow variables

How could I decide from a variable exactly, that is stock or flow type? Variables, which are measured at a point of time are ...
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27 views

Why do graphic card prices rise due to bitcoin miners?

I thought it would mean more sales thus more production and more profit, so why does nvidia and amd simply dont ramp up production if the trend has been now quite a long one? And as far as I can see ...
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18 views

Is there a way participants in an industry to also discuss how to keep a market healthy without it being considered collusion?

For a particular niche in demand but broad in utility industry, I am both a consumer and producer that participates internationally, and within segments there are public informal concerns that the ...
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53 views

What's the Difference Between Being Pro-business and Being Pro-market?

In a recent interview I watched a economist say something along the lines of: "There is a distinction between being pro-business and being pro-market. There should be rules in place so that ...
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2answers
63 views

It's unclear how market equilibrium is reached in case of overproduction

Let's assume that there is disequilibrium, namely that $P=P_2$, thus $Q_s > Q_d$. In other words, there is overproduction. This is perfectly competitive market, so competition between producers ...
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10 views

In what contexts are stable markets sub-optimal?

My understanding is that market stability is a good thing, because it allows more reliable estimates of profits (revenues minus expenses) and expected return-on-investment related to new investments. ...
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17 views

In perfect compition, how does the marginal revenue = marginal costs equality relates to the intersection of supply and demand curve?

In a perfect competitive market, the price and quantity are determined where supply and demand curve intersect (supply = upwards sloping because of increasing costs of production in short periods of ...
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11 views

Resources for periodical economics feed [duplicate]

I'm learning economics and I want to read/hear the world through the lenses of any economist. What are the best periodical economics news feeds? It could Magazines such as theeconomist.com Podcast ...
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20 views

Effect of using new techniques to produce higher level of output with same input

$Q. $ Suppose the problem Max $a_1x_1+a_2x_2$ s.t $$\begin{align}&b_1x_1+b_2x_2 \le L \\&c_1x_1+c_2x_2 \le K \\&x_1,x_2 \ge 0\end{align} $$ is solved using the ...
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24 views

What are the negative consequences of wage rigidity?

Wage rigidity is a widely documented source of market failure. However, it isn't as clear to me why we should care about wage rigidity at all? So, can anyone answer the question given in the title? ...
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3answers
97 views

Looking for a term that explains market participants that lie about their participation to gain access to said market

I'm Looking for a term that explains the behavior of a market participants that will lie or exaggerate how much or what they offer in order to gain access to a market that would otherwise be ...
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1answer
36 views

Vegetarians vs shoppers of humane meat/eggs/dairy - Who has the biggest impact on the factory farming meat industry?

I apologize for not being able to word this in a non subject specific way. So, for people who don't support widespread factory farming practices, there are people that abstain from meat completely, ...
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144 views

Call Market vs Auction Market vs Double Auction Market

I'm coming from a CS background and want to analyze different types of markets. Are Call, Auction and Double Auction markets mutually exclusive? As far as I could research Call market looks like ...
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2answers
52 views

Reductionism, value and market economics

If I'm not mistaken, the economic value provided by a business entity to the community is just one kind of value. We tend to put numbers to things such as stock price, revenue, profits and so on. ...
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20 views

Why do co-ops dominate in certain markets rather than more-conventional enterprises?

Why do co-ops dominate in certain markets rather than more-conventional enterprises? For example, the US dairy processing market seems to be dominated co-ops like Land'O Lakes and Dairy Farmers of ...
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149 views

What is the new price after an import quota?

For a small domestic market that can buy completely price elastic imports from the world, the price of the good will be at (P world). However, when there is an import quota of quantity (Q3 - Q2), why ...
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1answer
457 views

Why is ATC tangent to Demand in a Monopolistic or Mopolistically Competitive Firm Making Zero Profit?

I understand that the Average Total Cost is equivalent to demand in a zero profiting monopoly or monopolistically competitive firm in order for there to be zero profits (when ATC = P at a given ...
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232 views

Why isn't the cost of shoes affected by their size?

I have noticed that many shoe selling shops I have visited have the same price tag regardless of the shoe size. Intuitively I'd think the bigger the shoe the more material and consequently capital ...
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3answers
2k views

Why is the Market-Clearing Price also an Equilibrium Price?

When the price is such that supply equals demand for e.g. bicycles, everybody who wants to buy a bike at that price gets one, and every bike gets sold. Everybody goes home happy and the marketplace ...
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52 views

What is the name given to an exporting-only economy?

In international trading there can be an economy that only exports, but restrict the import to minimum or at all. I cannot recall what the name given to this type of economy.
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51 views

Episodes of Housing Crashes and Never Recovering

Looking at many housing markets in major cities around the world today it looks like most (London, New York, Sydney, Beijing, Toronto,...) have become totally detached from the earnings of the local ...
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1answer
66 views

What are some applications of Akerlof's 'lemons' in goods and services markets?

How can the idea of Akerlof's 'lemons' be applied to goods and services markets (that doesn't include second-hand cars)?
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153 views

If Germany is the largest exporter, why do Chinese products pervade the the US market?

Despite Germany being the third larger exporter in the world, I have not once seen German products on online retail sites such as Amazon.com. Why is this the case? Amazon in particular is plagued with ...
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397 views

Are market structures on a spectrum?

So I understand that each market structure has their own characteristics, and that for instance Perfect Competition involves high competition, and I believe Monopolistic competition slightly less so, ...
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1answer
90 views

When to prefer maximisation of surplus and when instead to prefer minimising differences in price and q to find market equilibrium?

Two alternative approaches to compute a market equilibrium (in static analysis) are either to minimize the differences (either using abs() or a quadratic diff) between supply-demand quantities and ...
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1answer
108 views

Difference between LMSR and Liquidity-Sensitive LMSR

What is the difference between the LMSR (logarithmic market scoring rule) and the Liquidity-Sensitive LMSR (LS-LMSR) and what would cause prediction markets like Augur to focus on the later model?
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1answer
284 views

Why do externalities lead to a Pareto-inefficient outcome?

So we know that under a Pareto-inefficient outcome, there is room for Pareto improvement, i.e. making someone better off without hurting anyone. Assume that there is a drug company which is in ...
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76 views

When to use the market and when to use central planning?

I have a basic question: my understanding is that in a market economy, economic decisions are governed by prices, i.e prices signal what should be produced & how much. This is opposed to central ...
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2answers
244 views

Would you consider airport parking to be a monopoly or a monopolistic market?

If you look at it one way and group the different companies that offer parking, it could be a monopoly as that is the only place you can park. On the other hand, the different companies offer ...
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2answers
167 views

“For a market to exist there must be scarcity” (T/F)

The answer provided was 'true', that scarcity was necessary in the existence of a market. But isn't that not always true? For example, there's a market for canned air, and air is most definitely not ...
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2answers
2k views

Is the marginal cost the same for every firm in a perfectly competitive market?

Spin-off from: market equilibrium quantity $\ne$ firm profit maximising quantity? Consider a perfectly competitive market with equilibrium price $P_{eq}$ and quantity $Q_{eq}$ and firm with profit ...
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142 views

market equilibrium quantity $\ne$ firm profit maximising quantity?

Consider a perfectly competitive market with equilibrium price $P_{eq}$ and quantity $Q_{eq}$ and firm with profit maximising quantity $Q_f$ as illustrated below: I guess any firm in the market would ...
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34 views

Demonstrating that markets yield productive and allocative efficiency to introductory students

Has anybody come across a nice, intuitive (i.e. neither formal nor technical) way to demonstrate how markets yield both productive and allocative efficiency? I suppose the allocative argument ...
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1answer
405 views

University course references for Market Structure/Industrial Organization

Are there any books that are used in University-level courses that contain a detailed analysis of market structure ( Perfect competition , Monopoly and so on)?
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278 views

What is the wealth of a company?

I would like to better understand what is the wealth of a company and what is made of. Is the wealth of a company similar to GDP of country, like a "gross company product" ? As example: can we say ...
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2answers
6k views

How can the abuses of monopoly power lead to market failure?

So I know that the abuses of monopoly power can cause market failure, but I don't know why that is. I am guessing that because monopoly's face a lack of competition, they have no incentive to improve ...
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1answer
187 views

Why currency purchasing power is linked to confidence in central banks

From the New Statesman, http://www.newstatesman.com/politics/economy/2016/02/coming-storm, "Ever since the collapse of the Bretton Woods system of pegged exchange rates in 1971, the sole guarantee ...
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1answer
328 views

Under what conditions does market failure occur?

Edit: Is it possible to broadly categorize the ways in which market failures occur into relatively few categories? If so, what are they?
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53 views

World company database?

I need to find the list of companies with their respective market caps and their sectors of activities. For now I have found these two links: • https://goo.gl/E8WJzu • http://goo.gl/vuHDuF But I ...
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2answers
42 views

We see stocks outperforming things like bonds in the long run (past 100 years), but could this be an artifact of that particular 100 year timeline?

When looking at historical return patterns for investments, one can clearly see the stellar performance of equities over the long haul. That being said, we know that we can center in on certain 20-25 ...
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0answers
111 views

Fundamental Theorem of Asset Pricing (Linear Algebra)

I saw this question in a textbook that I was recently reading and don't really know how to aprpoach this problem. Let $H$ be a finite dimensional vector space with inner product ($\cdotp$, $\cdotp$)....
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44 views

How to model optimal market pricing?

I am interested in understanding how to mathematically model market interaction to optimize pricing strategy. In my model I have two kinds of knowledge: the market's order book and the price/volume ...
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47 views

In which all market forms or types of competitions is the Price Elasticity of Demand quite high?

I know that for Monopolistic Competition, the PED is quite high as there is a variety of substitutes. The same logic applies for Perfect Competition, but what about Oligopoly? And also, in the case of ...
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1k views

What is the difference between 'actual' and 'potential' interaction between buyers and sellers?

In the book "Microeconomics" by Pyndyck and others, the author(s) define a 'market' as a collection of buyers and sellers, who by the actual or potential interaction with each other determine the ...