Implementation of the Walrasian Correspondence: The Boundary Problem
Abstract
Consider exchange economies in which preferences are continuous, convex and strongly monotonic. It is well known that the Walrasian correspondence is not Nash implementable. Maskin monotonicity (Maskin, 1999) is violated for allocations at the boundary of the feasible set. We derive an impossibility result showing that it is in fact not implementable in any solution concept. Next, we construct a sequential mechanism based on price-allocationannouncements that fits the very description of Walrasian Equilibrium. Imposing an additional domain restriction, we show that it fully implements the Walrasian correspondence in subgame perfect and strong subgame perfect equilibrium. We thus take care of the boundary problem that was prominent in the Nash implementation literature.Download Info
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Paper provided by Maastricht : METEOR, Maastricht Research School of Economics of Technology and Organization in its series Research Memoranda with number 037.Length:
Date of creation: 2005
Date of revision:
Handle: RePEc:dgr:umamet:2005037
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Web page: http://www.maastrichtuniversity.nl/web/UMPublications.htm
Related research
Keywords: microeconomics ;Other versions of this item:
- Olivier Bochet, 2007. "Implementation of the Walrasian correspondence: the boundary problem," International Journal of Game Theory, Springer, vol. 36(2), pages 301-316, October.
- Bochet, Olivier, 2007. "Implementation of the Walrasian Correspondence: The Boundary Problem," Open Access publications from Maastricht University urn:nbn:nl:ui:27-15284, Maastricht University.
- BOCHET, Olivier, 2005. "Implementation of the Walrasian correspondence: the boundary problem," CORE Discussion Papers 2005060, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
- NEP-ALL-2005-10-15 (All new papers)
References
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Citations
Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.Cited by:
- BOCHET, Olivier & MANIQUET, François, 2006.
"Virtual Nash implementation with admissible support,"
CORE Discussion Papers
2006084, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
- Bochet, Olivier & Maniquet, François, 2010. "Virtual Nash implementation with admissible support," Journal of Mathematical Economics, Elsevier, vol. 46(1), pages 99-108, January.
- Olivier, BOCHET & François, MANIQUET, 2006. "Virtual Nash implementation with admissible support," Discussion Papers (ECON - Département des Sciences Economiques) 2006043, Université catholique de Louvain, Département des Sciences Economiques.
- Veiga, Helena & Vorsatz, Marc, 2006.
"Price Manipulation in an Experimental Asset Market,"
Research Memoranda
024, Maastricht : METEOR, Maastricht Research School of Economics of Technology and Organization.
- Veiga, Helena & Vorsatz, Marc, 2009. "Price manipulation in an experimental asset market," European Economic Review, Elsevier, vol. 53(3), pages 327-342, April.
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