Analysis of equilibrium prices and quantities within network-structured markets applying the Lagrange function method

E. Aiyoshi, A. Maki, M. Nishida

Research output: Chapter in Book/Report/Conference proceedingConference contribution

Abstract

In the modern market economic system, there are many brokers between primary producers and final producers or consumers. For example, many farmers produce vegetables and supply them to consumers. Between the farmers and consumers there are many brokers called retailers. The involved transactions are modeled by network-structured markets. Equilibrium market prices are obtained as the optimal Lagrange multipliers. The present paper analyzes changes in equilibrium prices and quantities within network-structured markets using the Lagrange function method. Then, different network structures and different specification for the sales and cost functions within the network-structured markets are analyzed.

Original languageEnglish
Title of host publicationMODSIM 2011 - 19th International Congress on Modelling and Simulation - Sustaining Our Future
Subtitle of host publicationUnderstanding and Living with Uncertainty
Pages1345-1351
Number of pages7
Publication statusPublished - 2011 Dec 1
Event19th International Congress on Modelling and Simulation - Sustaining Our Future: Understanding and Living with Uncertainty, MODSIM2011 - Perth, WA, Australia
Duration: 2011 Dec 122011 Dec 16

Publication series

NameMODSIM 2011 - 19th International Congress on Modelling and Simulation - Sustaining Our Future: Understanding and Living with Uncertainty

Other

Other19th International Congress on Modelling and Simulation - Sustaining Our Future: Understanding and Living with Uncertainty, MODSIM2011
CountryAustralia
CityPerth, WA
Period11/12/1211/12/16

Keywords

  • Duality theorem for optimization
  • Lagrange function method
  • Lagrange multipliers
  • Network-structured market

ASJC Scopus subject areas

  • Modelling and Simulation

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    Aiyoshi, E., Maki, A., & Nishida, M. (2011). Analysis of equilibrium prices and quantities within network-structured markets applying the Lagrange function method. In MODSIM 2011 - 19th International Congress on Modelling and Simulation - Sustaining Our Future: Understanding and Living with Uncertainty (pp. 1345-1351). (MODSIM 2011 - 19th International Congress on Modelling and Simulation - Sustaining Our Future: Understanding and Living with Uncertainty).