Summmary. The research explores the relationship between games and the economic environment in which the games might be embedded. The focus is on a market institution in which agents buy and sell rights to participate in a follow-on stage of strategic interaction. The central question posed concerns how two different types of processes, the game and the market, interact. The market converges to a competitive equilibrium that is consistent with the Nash equilibrium that obtains in the game, and the convergence of the market to a competitive equilibrium lags the convergence of behaviors in the game to a Nash equilibrium.
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Received: April 19, 1999; revised version: 24 July, 1999
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Plott, C., Williamson, D. Markets for contracts: experiments exploring the compatibility of games and markets for games. Econ Theory 16, 639–660 (2000). https://doi.org/10.1007/PL00020946
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DOI: https://doi.org/10.1007/PL00020946