Indivisibilities and Graph Theory

John Leahy and I have developed new machinery for analyzing markets for large indivisible goods, such as houses.

A Graph Theoretic Approach to Markets for Indivisible Goods” and

Comparative Statics in Markets for Indivisible Goods”.

These papers introduce “GA-structures” that we show to be ideally suited to comparative static analysis of markets with indivisibilities. In addition to having fascinating mathematical properties, they connect with a long-standing economic tradition, in particular the “rent gradient” models of Ricardo. We will apply the new methods of analysis in due course.