Efficient Allocations, Equilibria and Stability in Scarf's Economy

Randon, Emanuela ; Simmons, Peter (2008) Efficient Allocations, Equilibria and Stability in Scarf's Economy. DOI 10.6092/unibo/amsacta/3328.
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Abstract

Scarf's economy has been a vehicle in understanding stability properties in exchange economies. The full set of market equilibria and Pareto optimal allocations for this economy has not been analysed. This paper aims to do that. Firstly, we examine the Pareto optima and we and three different classes. Only Class I exhausts the aggregate endowments of all the goods. Class II and III involve throwing away partially or totally one good in order to achieve Pareto efficiency. Secondly, we explore the price and endowment distribution combinations which sustain the different Pareto Optima as market equilibria. A Pareto optimum which involves throwing away the whole endowment of one of the goods is globally stable.

Abstract
Document type
Monograph (Working Paper)
Creators
CreatorsAffiliationORCID
Randon, Emanuela
Simmons, Peter
Keywords
Exchange economy; Complements; Stability.
Subjects
DOI
Deposit date
05 Jul 2012 13:36
Last modified
29 Jan 2013 10:28
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