In decentralised market economies, supply-constrained equilibria may persist as coordination failures, sustained but not caused by price rigidities. This feature may be arbitrarily severe, even at prices com- patible with competitive equilibrium. The supply-constraints may originate in rational...

This paper presents a personal perspective on the field of public economics, as I have seen it evolve over the past forty years. Starting in the early fifties, microeconomic theory invaded the age-old field of public finance. A central core of this work consists in deriving general qualitative...

We propose an objective for the firm in a general model of production economies extending over time under uncertainty and with incomplete markets. Trading in commodities and shares of stock occurssequentially on spot markets at all date-events. We derive the objective of the firm from the...

The formulation of uncertainty in terms of exogenous states, introduced by Arrow in 1952 (published 1953), has been extremely fruitful. The paper discusses informally the question, raised sporadically in the oral tradition and put in writing by Kurz in1974 and again recently, whether that...

The introduction of banks which issue and supply balances and payout their profits as dividends is the natural modification of the competitive equilibrium model developed by Arrow and Debreu which encompasses monetary economies. Equilibria in which money serves as a medium of exchange, and...

The European economic integration leads to increasing mobility of factors, thereby threatening the stability of social transfer programs. This paper investigates the possibility to achieve by means of voluntary matching grants both the optimal allocation of factors and the optimal level of...

Conditional Expected Utility Theory (CEUT) provides an axiomatic foundation for a theory of decision under uncertainty which allows agents to choose which event in the state space will occur. Here we provide an alternative axiomatization of this situation. In this framework CEUT may be seen a...

In recent decades, the concept of subjective probability has been increasingly applied to an adversary's choices in strategic games. A careful examination reveals that the standard construction of subjective probabilities does not apply in this context. We show how the difficulty may be overcome...