On the Proximity of Markets with Integral Equilibria

Abstract

We study Fisher markets that admit equilibria wherein each good is integrally assigned to some agent. While strong existence and computational guarantees are known for equilibria of Fisher markets with additive valuations (Eisenberg and Gale 1959; Orlin 2010), such equilibria, in general, assign goods fractionally to agents. Hence, Fisher markets are not directly applicable in the context of indivisible goods. In this work we show that one can always bypass this hurdle and, up to a bounded change in agents’ budgets, obtain markets that admit an integral equilibrium. We refer to such markets as pure markets and show that, for any given Fisher market (with additive valuations), one can efficiently compute a “near-by,” pure market with an accompanying integral equilibrium.Our work on pure markets leads to novel algorithmic results for fair division of indivisible goods. Prior work in discrete fair division has shown that, under additive valuations, there always exist allocations that simultaneously achieve the seemingly incompatible properties of fairness and efficiency (Caragiannis et al. 2016); here fairness refers to envyfreeness up to one good (EF1) and efficiency corresponds to Pareto efficiency. However, polynomial-time algorithms are not known for finding such allocations. Considering relaxations of proportionality and EF1, respectively, as our notions of fairness, we show that fair and Pareto efficient allocations can be computed in strongly polynomial time.