Sharing Beliefs: Between Agreeing and Disagreeing

In an exchange economy with no aggregate uncertainty, and Bayesian agents, Pareto optimal allocations provide full insurance if and only if the agents have a common prior. It is hard to explain why there is relatively so little betting taking place. One is led to ask, when are full insurance allocations optimal for uncertainty averse agents? it turns out that commonality of beliefs, appropriately defined, is key again.

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Year of publication:	1998
Authors:	Billot, A. ; Chateauneuf, A. ; Gilboa, I. ; Tallon, J.-M.
Institutions:	Centre de recherche de mathématiques et économie mathématique (CERMSEM), Centre d'Économie de la Sorbonne
Subject:	OPTIMIZATION \| UTILITY FUNCTION

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Series:	Papiers d'Economie Mathématique et Applications.
Type of publication:	Book / Working Paper
Notes:	22 pages
Classification:	D61 - Allocative Efficiency; Cost-Benefit Analysis ; D51 - Exchange and Production Economies
Source:	RePEc - Research Papers in Economics

Persistent link: https://www.econbiz.de/10005663592