Shadow Price Calculations in Distorted Economies.
This paper is concerned with the properties of public-sector shadow prices in the presence of market distortio ns. Some theoretical properties of shadow prices in a competitive gen eral equilibrium model are derived and numerical examples are used to argue that partial equilibrium "weighted-average" rules connecting shadow prices and market prices may be quite misleading. The main re sults are derived in a closed-economy model, but are extended to a mo del with traded as well as nontraded goods. Copyright 1987 by The editors of the Scandinavian Journal of Economics.
Year of publication: |
1987
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Authors: | Smith, Alasdair |
Published in: |
Scandinavian Journal of Economics. - Wiley Blackwell, ISSN 1467-9442. - Vol. 89.1987, 3, p. 287-302
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Publisher: |
Wiley Blackwell |
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