The American economy has undergone a dramatic structural change in the first decade of the 21st Century. The real-economy causes of this transformation, and their expression via the real estate market and its financial derivatives’ market, and their final manifestation in world financial...

Jointly with Erkko Etula, Paul Samuelson [2006] claims that the “Leontief – Sraffa matrix equations for input/output must obey constant returns to scale”. However, in an unrelated work, Amartya Sen [2003] claims that Sraffa’s [1960] “analysis does not need any assumption of constant...

Ken Arrow (1998) asks, “What has economics to say about racial discrimination?” He replies – entirely correctly – that racial “segregation within an industry – that is, firms with either all black or all white labor forces” – may be explained by economic theory, but “the...

Diverse identities, some socially shared, arise from a person’s affiliation with multiple overlapping communities, which are non-disjoint subsets of persons in society. I prove that identification of each individual with binary preferences or their utility function representation, commonplace...

Adam Smith (1776) devoted the first three chapters to the division of labor in his Inquiry into the Nature and Causes of the Wealth of Nations. This process, carried far enough, eventually results in a divergence between the distributions of supplies and demands of such...

This paper compares the theory of value and distribution of Arrow and Debreu [1954] with that of Sraffa [1960]. I consider such versions of the two models that capture their salient features, without aiming at the greatest possible generality, so as to isolate the precise nature of the...

A country’s production possibility frontier or PPF is defined as the boundary of its economy’s production set in the net output space for a given technology and fixed quantities of primary factors of production. In general equilibrium theory, exogenous changes in technology or primary-factor...

We prove the existence of a Pareto optimal state of a finite society that has socially differentiated persons, each with non-binary personal preferences that quasi-order a finite set of alternatives. Everybody engages in a volitional act of choice by maximization of non-binary preferences. As a...

This paper establishes relationships between static Nash equilibria and dynamic Markov perfect equilibria of tariff and quota retaliation games. In supermodular games where tariffs are strategic complements, the steady state of every, symmetric Markov perfect equilibrium must have lower tariffs...

We prove the existence of a Pareto optimal state of a society with non-binary personal preferences. To our knowledge, this is the weakest set of conditions under which the existence of a Pareto optimal state has been proven. In our theory everybody in society engages in maximization as a...