On a spontaneous decentralized market process

Abstract

We examine a spontaneous decentralized market process widely observed in real life labor markets. This is a natural random decentralized dynamic competitive process. We show that this process converges globally and almost surely to a competitive equilibrium. This result is surprisingly general by assuming only the existence of an equilibrium. Our findings have also meaningful policy implications.

Keywords

• Spontaneous market process
• decentralized market
• competitive equilibrium