Fisher Model of Markets

Much of the recent theoretical computational work on market equilibrium uses the, so called, Fisher Model (see chapters 5 and 6 of the AGT book or talks and papers on Vijay Vazirani’s home page.)  The model is somewhat simpler than Arrow-Debreu markets in that one party, the seller, brings into the market all goods except for money, which is the only thing that the others bring.  This seemingly small variation seems to make handling it more tractable. In his ALGO invited talk, Vijay opined that Irving Fisher, the model’s father, is somewhat forgotten today probably due to his famous words just days before the stock market crash of 1929: “Stock prices have reached what looks like a permanently high plateau.” Vijay pointed out that Fisher’s comments just a little later are captured on youtube:

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