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Equilibrium Allocation (equilibrium + allocation)

Distribution by Scientific Domains

Business, Economics, Finance and Accounting	91%

Selected Abstracts

Comparing Sunspot Equilibrium And Lottery Equilibrium Allocations: The Finite Case*

INTERNATIONAL ECONOMIC REVIEW, Issue 2 2004
Rod Garratt
Sunspot equilibrium and lottery equilibrium are two stochastic solution concepts for nonstochastic economies. We compare these concepts in a class of completely finite, (possibly) nonconvex exchange economies with perfect markets, which requires extending the lottery model to the finite case. Every equilibrium allocation of our lottery model is also a sunspot equilibrium allocation. The converse is almost always true. There are exceptions, however: For some economies, there exist sunspot equilibrium allocations with no lottery equilibrium counterpart. [source]

Market participation in delegated and intrinsic common-agency games

THE RAND JOURNAL OF ECONOMICS, Issue 1 2009
David Martimort
We study how competition in nonlinear pricing between two principals (sellers) affects market participation by a privately informed agent (consumer). When participation is restricted to all or nothing ("intrinsic" agency), the agent must choose between both principals' contracts and selecting her outside option. When the agent is afforded the additional possibilities of choosing only one contract ("delegated" agency), competition is more intense. The two games have distinct predictions for participation. Intrinsic agency always induces more distortion in participation relative to the monopoly outcome, and equilibrium allocations are discontinuous for the marginal consumer. Under delegated agency, relative to monopoly, market participation increases (respectively, decreases) when contracting variables are substitutes (respectively, complements) on the intensive margin. Equilibrium allocations are continuous for the marginal consumer and the range of product offerings is identical to both the first-best and the monopoly outcome. [source]

SCREENING ETHICS WHEN HONEST AGENTS CARE ABOUT FAIRNESS*

INTERNATIONAL ECONOMIC REVIEW, Issue 1 2006
Ingela Alger
A principal faces an agent with private information who is either honest or dishonest. Honesty involves revealing private information truthfully if the probability that the equilibrium allocation chosen by an agent who lies is small enough. Even the slightest intolerance for lying prevents full ethics screening whereby the agent is given proper incentives if dishonest and zero rent if honest. Still, some partial ethics screening may allow for taking advantage of the potential honesty of the agent, even if honesty is unlikely. If intolerance for lying is strong, the standard approach that assumes a fully opportunistic agent is robust. [source]

Comparing Sunspot Equilibrium And Lottery Equilibrium Allocations: The Finite Case*

Multiunit Pay-Your-Bid Auction with One-Dimensional Multiunit Demands*

INTERNATIONAL ECONOMIC REVIEW, Issue 3 2003
Bernard Lebrun
An arbitrary number of units of a good is sold to two bidders through a discriminatory auction. The bidders are homogeneous ex ante and their demand functions are two-step functions that depend on a single parameter. We characterize the symmetric Bayesian equilibrium and prove its existence and uniqueness. We compare this equilibrium with the equilibrium of the multiunit Vickrey auction and with the equilibria of the single-unit first price and second price auctions. We examine the consequences of bundling all units into one package. We study the impacts that variations of the "relative" supply have on the equilibrium, on the bidders' average payoffs per unit, and on the efficiency of the equilibrium allocation. [source]

Core equivalence for residential land use models

INTERNATIONAL JOURNAL OF ECONOMIC THEORY, Issue 4 2008
Courtney LaFountain
D50; D60; R13; R14 I demonstrate that in the monocentric city model, an allocation is in the core if and only if it is an equilibrium allocation, as long as households are endowed with strictly positive quantities of a composite consumption good, enjoy any net trade bundle at least as much as they enjoy one on the boundary of their choice set, have monotonic preferences, have preferences and endowments that are not too different, and as long as there is land at every location. I also show that equilibria exist in these circumstances, so the core is not empty. [source]

A Disaggregated Markov-Switching Model of the Business Cycle in UK Manufacturing

THE MANCHESTER SCHOOL, Issue 4 2000
Hans-Martin Krolzig
Exploring index of production data for six major UK manufacturing sectors, we investigate the interaction of the UK business cycle with changes in the industrial structure of the UK economy during the last three decades. We propose a Markov-switching vector equilibrium correction model with three regimes representing recession, normal growth and high growth. The regime shifts simultaneously affect the common growth rate and the sectoral equilibrium allocation of industrial production. In contrast to previous investigations, a common cycle can be uncovered which is closely related to traditional datings of the UK business cycle. [source]

Comparing Sunspot Equilibrium And Lottery Equilibrium Allocations: The Finite Case*

Optimal Allocation of Land between Productive Use and Recreational Use

JOURNAL OF REGIONAL SCIENCE, Issue 2 2003
Eduardo L. Giménez
We address this issue with a comprehensive approach. A static rational general equilibrium framework is developed in which heterogeneous agents allocate land and time endowments between alternative uses. This modeling has important advantages. First, Pareto-optimal and voluntary-contribution equilibrium allocations are obtained in a unified set-up. Second, the suboptimality result of the decentralized equilibrium, the free-rider problem on the provision of this nonexcludable public good, and different mechanisms to return the economy to its first-best are analyzed. Finally, a methodological critique is made of some empirical literature, and it is suggested that our theoretical microeconomic-based structure seems to be a suitable starting point for empirical research. [source]

Nonlinear Pricing in General Equilibrium Models with Joint Production

THE JAPANESE ECONOMIC REVIEW, Issue 1 2001
Kazuya Kamiya
This paper considers general equilibrium models of public utilities which produce either public goods or private goods. In the models, cases of increasing returns are not a priori excluded. The products of the public utilities and their costs are allocated to the consumers according to a rule that is dependent on information communicated to the public utilities. We show that if the public utilities follow a nonlinear pricing rule, the equilibrium allocations are always Pareto-optimal. Moreover, the message space is of finite dimensions. JEL Classification Numbers: D51, D60, H41, H42. [source]