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We show that efficient exchange obtains independently of the degree to which a legal system protects the rights of owners. We study a number of different legal rules, including property rules (strong protection), liability rules (any party can take the owner's asset but must pay a...
Persistent link: https://www.econbiz.de/10012997275
I study a model where people can be matched in fractions. That is to say, whether a pair is matched is not a binary matter. They can be matched with some intensity. Each has a fixed availability: the total intensity with which he is matched to his partners. I propose a notion of competitive...
Persistent link: https://www.econbiz.de/10014183372
How robust are economic models to the introduction of irrational agents? The Pareto efficiency of competitive equilibria is not robust: one irrational agent leads to inefficiency. But the property that rational agents cannot use their own resources to Pareto-improve on their competitive...
Persistent link: https://www.econbiz.de/10014217724
If consumption takes time, and time is limited, there exists a time constraint in addition to the expenditure constraint of a consumer. This may lead to a form of satiation, where consumers cannot consume all commodities they purchase. We establish existence of competitive equilibrium in the...
Persistent link: https://www.econbiz.de/10013127627
The economic theory of the second best has been an analytical staple of welfare economics and policy analysis since Lipsey and Lancaster (1956) set forth the idea. That theory challenged the then standard claim that removing violations of the necessary conditions for a competitive equilibrium...
Persistent link: https://www.econbiz.de/10014139927
Italian Abstract: L'obiettivo è dare al lettore gli strumenti per costruire e risolvere il problema di puro scambio, utilizzando la scatola di Edgeworth. I due teoremi del benessere sono dimostrati euristicamente attraverso semplici calcoli
Persistent link: https://www.econbiz.de/10014141699
Conventional wisdom tells us that with no market failure and local non-satiation of preferences, the core is at least as large as the collection of competitive equilibrium allocations.We con.rm this for a standard model featuring land. Next we consider the public land ownership version of the...
Persistent link: https://www.econbiz.de/10014067832
There is a growing body of research in economics that studies the consequences of time-inconsistent preferences. This paper introduces time-inconsistent preferences in a general equilibrium setting. We discuss how the standard notion of competitive equilibrium should be extended in order to...
Persistent link: https://www.econbiz.de/10014073419
We introduce a framework for analyzing Bertrand-Edgeworth equilibria in finite Arrow-Debreu exchange economies. A key feature is the way trade takes place. There are two main stages. In the first stage agents simultaneously choose prices and quantities of commodities they want to sell; in the...
Persistent link: https://www.econbiz.de/10014078305
The paper addresses the following question: How efficient is the market system in allocating resources if trade takes place at some prices p that are not necessarily competitive? Even though there are many partial answers to this question, an answer that stands comparison to the rigor by which...
Persistent link: https://www.econbiz.de/10014100049