Vecon Lab Call Market: Introduction

This program runs a uniform price double auction, in which buyers and sellers submit bids and offers, which are ranked and crossed to determine a provisional trading price. The market is "called" and trades are finalized when the time expires or the experimenter presses the Stop button. At that time, all units with offers below the clearing price are sold, and all units with bids above the clearing price are purchased. Variants of this procedure are sometimes used in electronic trading of stocks and in wholesale markets for electric power, which are cleared hourly. The program permits the instructor to implement market changes "on the fly" after any round, e.g. demand or supply shifts, taxes on buyers or sellers, price ceilings or floors, and collusion among buyers or sellers.

Key Concepts:
Supply and Demand
Market Clearing Price
Shifts in Supply and Demand
Consumer Surplus
Producer Surplus
Market Efficiency
Copyright 2009, Charles Holt, Please report problems and suggestions:

Vecon Lab - May 26, 2017