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Core and stable sets of exchange economies with externalities

Author

Listed:
  • Maria Gabriella Graziano

    (Università di Napoli Federico II)

  • Claudia Meo

    (Università di Napoli Federico II)

  • Nicholas C. Yannelis

    (University of Iowa)

Abstract

It is known that the core of an economy with externalities may be empty. We consider two concepts of dominance that allow us to prove that the set formed by individually rational, Pareto optimal allocations is stable and coincides with the core that, consequently, is non-empty.

Suggested Citation

  • Maria Gabriella Graziano & Claudia Meo & Nicholas C. Yannelis, 2023. "Core and stable sets of exchange economies with externalities," Economic Theory Bulletin, Springer;Society for the Advancement of Economic Theory (SAET), vol. 11(1), pages 27-44, April.
    • Handle: RePEc:spr:etbull:v:11:y:2023:i:1:d:10.1007_s40505-022-00239-x
    DOI: 10.1007/s40505-022-00239-x
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    1. Graziano, Maria Gabriella & Meo, Claudia & Yannelis, Nicholas C., 2017. "Stable sets for exchange economies with interdependent preferences," Journal of Economic Behavior & Organization, Elsevier, vol. 140(C), pages 267-286.
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    13. Christian Pietro & Maria Gabriella Graziano & Vincenzo Platino, 2022. "Social loss with respect to the core of an economy with externalities," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 73(2), pages 487-508, April.
    14. Maria Gabriella Graziano & Claudia Meo & Nicholas C. Yannelis, 2015. "Stable sets for asymmetric information economies," International Journal of Economic Theory, The International Society for Economic Theory, vol. 11(1), pages 137-154, March.
    15. Borglin, Anders, 1973. "Price characterization of stable allocations in exchange economies with externalities," Journal of Economic Theory, Elsevier, vol. 6(5), pages 483-494, October.
    16. Maria Gabriella Graziano & Claudia Meo & Nicholas C. Yannelis, 2020. "Shapley and Scarf housing markets with consumption externalities," Journal of Public Economic Theory, Association for Public Economic Theory, vol. 22(5), pages 1481-1514, September.
    17. Carlos Hervés-Beloso & Emma Moreno-García, 2022. "Revisiting the Coase theorem," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 73(2), pages 421-438, April.
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    More about this item

    Keywords

    Other-regarding preferences; Externalities; Stable sets; Core;
    All these keywords.

    JEL classification:

    • C71 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Cooperative Games
    • D51 - Microeconomics - - General Equilibrium and Disequilibrium - - - Exchange and Production Economies
    • D62 - Microeconomics - - Welfare Economics - - - Externalities
    • D70 - Microeconomics - - Analysis of Collective Decision-Making - - - General

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