Computer Science – Computer Science and Game Theory
Scientific paper
2007-05-28
Computer Science
Computer Science and Game Theory
Scientific paper
We discuss the design of efficient scrip systems and develop tools for empirically analyzing them. For those interested in the empirical study of scrip systems, we demonstrate how characteristics of agents in a system can be inferred from the equilibrium distribution of money. From the perspective of a system designer, we examine the effect of the money supply on social welfare and show that social welfare is maximized by increasing the money supply up to the point that the system experiences a ``monetary crash,'' where money is sufficiently devalued that no agent is willing to perform a service. We also examine the implications of the presence of altruists and hoarders on the performance of the system. While a small number of altruists may improve social welfare, too many can also cause the system to experience a monetary crash, which may be bad for social welfare. Hoarders generally decrease social welfare but, surprisingly, they also promote system stability by helping prevent monetary crashes. In addition, we provide new technical tools for analyzing and computing equilibria by showing that our model exhibits strategic complementarities, which implies that there exist equilibria in pure strategies that can be computed efficiently.
Friedman Eric J.
Halpern Joseph Y.
Kash Ian A.
No associations
LandOfFree
Optimizing Scrip Systems: Efficiency, Crashes, Hoarders, and Altruists does not yet have a rating. At this time, there are no reviews or comments for this scientific paper.
If you have personal experience with Optimizing Scrip Systems: Efficiency, Crashes, Hoarders, and Altruists, we encourage you to share that experience with our LandOfFree.com community. Your opinion is very important and Optimizing Scrip Systems: Efficiency, Crashes, Hoarders, and Altruists will most certainly appreciate the feedback.
Profile ID: LFWR-SCP-O-498823