Affordable Access

Publisher Website

Price characterization of stable allocations in exchange economies with externalities

Authors
Journal
Journal of Economic Theory
0022-0531
Publisher
Elsevier
Publication Date
Volume
6
Issue
5
Identifiers
DOI: 10.1016/0022-0531(73)90089-6

Abstract

Abstract A pure exchange economy where the consumers have utility functions U i ( v 1( x 1),…, v m ( x m )) for i = 1,…, m and where x j is the consumption of consumer j, is studied. U i may be nonincreasing or nondecreasing in v j for j ≠ i. i is said to be nonbenevolent or nonmalevolent towards j, accordingly. An allocation is stable if no coalition can redistribute what it receives in the allocation to get an allocation which is preferred, given the consumptions of the consumers in the complementary coalition. Results concerning the relation among the Paretooptimal, stable and equilibrium allocations (under different definitions of equilibrium) are given. In particular, it turns out that in case every consumer is non-benevolent towards every other consumer, the classical results, concerning the relation between Paretooptimal allocations and equilibrium allocations, can be generalized in a satisfactory way.

There are no comments yet on this publication. Be the first to share your thoughts.