ABSTRACT
This chapter reviews the evolution of trading structures by examining two pertinent strands in the literature on economies with interacting agents, one, works that presume a specified topology of interactions among agents, and two, works that let random mechanisms determine that topology. It also reviews interactive discrete choice models in isotropic settings and proposes extensions within certain stylized anisotropic settings, which are particularly interesting for economists. The chapter suggests that the random topology of interaction approach, which has employed random graph theory to study evolution of trading structures, may go beyond analyses of sizes of trading groups and thus exploit the full range of possible topological properties of trading structures. It proposes to integrate those approaches and to exploit their natural complementarities. The chapter addresses a number of additional topics, including matching models, spatial aspects of the evolution of trading structures and issues of statistical inference.
