Thursday, March 28, 2019

A little trick on price

Price is determined after the fact of competition.

Competition for goods is all about finding the short queues and skipping the long ones. As quques tend to stabilize, firms and households use simply proportionality to go from queue length to price, they can price everything by the wait in line.

Price is set after the fact. agents compute the  ney ratio that keeps the bins optimally full of the good. If the ratio is not profitable, they execute substitutions, all in an intent to spend less time waiting in line.

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