Incentive ratios of Fisher markets

Ning Chen, Xiaotie Deng, Hongyang Zhang, Jie Zhang

Research output: Chapter in Book/Report/Conference proceedingChapter in a published conference proceeding

27 Citations (SciVal)


In a Fisher market, a market maker sells m items to n potential buyers. The buyers submit their utility functions and money endowments to the market maker, who, upon receiving submitted information, derives market equilibrium prices and allocations of its items. While agents may benefit by misreporting their private information, we show that the percentage of improvement by a unilateral strategic play, called incentive ratio, is rather limited—it is less than 2 for linear markets and at most e1/e ≈ 1.445 for Cobb-Douglas markets. We further prove that both ratios are tight.
Original languageEnglish
Title of host publicationAutomata, Languages, and Programming
EditorsA. Czumaj, K. Melhorn, A. Pitts, R. Wattenhofer
Number of pages12
ISBN (Print)978-3-642-31584-8
Publication statusPublished - 2012

Publication series

NameLecture Notes in Computer Science


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