### Abstract

We present a strongly polynomial algorithm for computing an equilibrium in Arrow-Debreu exchange markets with linear utilities. Our algorithm is based on a variant of the weakly-polynomial Duan–Mehlhorn (DM) algorithm. We use the DM algorithm as a subroutine to identify revealed edges, i.e. pairs of agents and goods that must correspond to best bang-per-buck transactions in every equilibrium solution. Every time a new revealed edge is found, we use another subroutine that decides if there is an optimal solution using the current set of revealed edges, or if none exists, finds the solution that approximately minimizes the violation of the demand and supply constraints. This task can be reduced to solving a linear program (LP). Even though we are unable to solve this LP in strongly polynomial time, we show that it can be approximated by a simpler LP with two variables per inequality that is solvable in strongly polynomial time.

Original language | English (US) |
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Title of host publication | STOC 2019 - Proceedings of the 51st Annual ACM SIGACT Symposium on Theory of Computing |

Editors | Moses Charikar, Edith Cohen |

Publisher | Association for Computing Machinery |

Pages | 54-65 |

Number of pages | 12 |

ISBN (Electronic) | 9781450367059 |

DOIs | |

State | Published - Jun 23 2019 |

Event | 51st Annual ACM SIGACT Symposium on Theory of Computing, STOC 2019 - Phoenix, United States Duration: Jun 23 2019 → Jun 26 2019 |

### Publication series

Name | Proceedings of the Annual ACM Symposium on Theory of Computing |
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ISSN (Print) | 0737-8017 |

### Conference

Conference | 51st Annual ACM SIGACT Symposium on Theory of Computing, STOC 2019 |
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Country | United States |

City | Phoenix |

Period | 6/23/19 → 6/26/19 |

### Keywords

- Linear Exchange Markets
- Market Equilibria
- Strongly Polynomial Algorithm
- Z-Matrix

### ASJC Scopus subject areas

- Software

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## Cite this

*STOC 2019 - Proceedings of the 51st Annual ACM SIGACT Symposium on Theory of Computing*(pp. 54-65). (Proceedings of the Annual ACM Symposium on Theory of Computing). Association for Computing Machinery. https://doi.org/10.1145/3313276.3316340