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On The Efficiency Of Market Equilibrium In Production Economies

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Author Info
Antonio Villar Notario (Instituto Valenciano de Investigaciones Económicas)

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Abstract

This paper introduces the notion of Market Equilibrium With Active Consumers (MEWAC), in order to characterize the efficiency of market outcomes in production economies. We show that, no matter the behaviour followed by the firms, a market equilibrium is efficient if it is a MEWAC. And also that every efficient allocation can be decentralized as a MEWAC in which firms follow the marginal pricing rule.

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File URL: http://www.ivie.es/downloads/docs/wpasad/wpasad-2000-17.pdf
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Publisher Info
Paper provided by Instituto Valenciano de Investigaciones Económicas, S.A. (Ivie) in its series Working Papers. Serie AD with number 2000-17.

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Length: 17 pages
Date of creation: Jun 2000
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Publication status: Published by Ivie
Handle: RePEc:ivi:wpasad:2000-17

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  1. Hammond, Peter J & Villar, Antonio, 1998. " Efficiency with Non-convexities: Extending the "Scandinavian Consensus" Approaches," Scandinavian Journal of Economics, Blackwell Publishing, vol. 100(1), pages 11-32, March. [Downloadable!] (restricted)
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  2. Guesnerie, Roger, 1975. "Pareto Optimality in Non-Convex Economies," Econometrica, Econometric Society, vol. 43(1), pages 1-29, January. [Downloadable!] (restricted)
  3. Bonnisseau, Jean-Marc & Cornet, Bernard, 1988. "Existence of equilibria when firms follow bounded losses pricing rules," Journal of Mathematical Economics, Elsevier, vol. 17(2-3), pages 119-147, April. [Downloadable!] (restricted)
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  4. Antonio Villar, 2007. "Competitive Pricing," Working Papers 07.08, Universidad Pablo de Olavide, Department of Economics. [Downloadable!]
  5. Aaron S. Edlin & Mario Epelbaum & Walter P. Heller, 1995. "Is Perfect Price Discrimination Really Efficient? Welfare and Existence in General Equilibrium," University of California at San Diego, Economics Working Paper Series 95-32, Department of Economics, UC San Diego.
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  6. Moriguchi, Chiaki, 1996. "Two-part marginal cost pricing in a pure fixed cost economy," Journal of Mathematical Economics, Elsevier, vol. 26(3), pages 363-385. [Downloadable!] (restricted)
  7. Vohra, Rajiv, 1988. "Optimal regulation under fixed rules for income distribution," Journal of Economic Theory, Elsevier, vol. 45(1), pages 65-84, June. [Downloadable!] (restricted)
  8. Antonio Villar Notario & Peter Hammond, 1998. "- Valuation Equlibrium Revisited," Working Papers. Serie AD 1998-24, Instituto Valenciano de Investigaciones Económicas, S.A. (Ivie). [Downloadable!]
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