Abstract
We present the first combinatorial polynomial time algorithm for computing the equilibrium of the Arrow-Debreu market model with linear utilities. Our algorithm views the allocation of money as flows and iteratively improves the balanced flow as in [Devanur et al. 2008] for Fisher’s model. We develop new methods to carefully deal with the flows and surpluses during price adjustments. In our algorithm, we need O(n 6log(nU)) maximum flow computations, where n is the number of persons and U is the maximum integer utility, and the length of the numbers is at most O(nlog(nU)) to guarantee an exact solution. The previous polynomial time algorithms [Nenakov and Primak 1983, Jain 2007, Ye 2007] for this problem are based on solving convex programs using the ellipsoid algorithm or interior-point method.
A full version of this paper is available at http://arxiv.org/abs/1212.0979
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Duan, R., Mehlhorn, K. (2013). A Combinatorial Polynomial Algorithm for the Linear Arrow-Debreu Market. In: Fomin, F.V., Freivalds, R., Kwiatkowska, M., Peleg, D. (eds) Automata, Languages, and Programming. ICALP 2013. Lecture Notes in Computer Science, vol 7965. Springer, Berlin, Heidelberg. https://doi.org/10.1007/978-3-642-39206-1_36
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DOI: https://doi.org/10.1007/978-3-642-39206-1_36
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