Abstract
The trading system, like all evolving systems, contains a mechanism of self-negation. We have proven that the polarization of trading power is an inevitable product of the evolution of the trading system; when polarization exceeds a certain threshold, the efficiency of resource allocation in the trading system will rapidly decay. We will also prove that we cannot build a perfect institutional system that balances fairness and efficiency in the trading system. This means that we cannot effectively prevent the metamorphosis of the trading system, nor can we guarantee the perfect evolution of the trading system.
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© 2024 The Author(s), under exclusive license to Springer Nature Singapore Pte Ltd.
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Wang, Z. (2024). The Imperfection of the Trading System. In: Trading Economics. Contributions to Economics. Springer, Singapore. https://doi.org/10.1007/978-981-99-9875-3_26
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DOI: https://doi.org/10.1007/978-981-99-9875-3_26
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Publisher Name: Springer, Singapore
Print ISBN: 978-981-99-9874-6
Online ISBN: 978-981-99-9875-3
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