Stable Sets for Asymmetric Information Economies
AbstractAn exchange economy with asymmetrically informed agents is considered with an exogenous rule that regulates the information sharing among agents. For it, the notion of stable sets à la Von Neumann and Morgenstern is analyzed. Two different frameworks are taken into account as regards preferences: a model without expectations and a model with expected utility. For the first one, it is shown that the set $V$ of all individually rational, Pareto optimal, symmetric allocations is the unique stable set of symmetric allocations. For the second one, an example is presented which shows that the same set $V$ is not externally stable and a weaker result is proved. Finally, the coalitional incentive compatibility of allocations belonging to the unique stable set is provided.
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Bibliographic InfoPaper provided by Centre for Studies in Economics and Finance (CSEF), University of Naples, Italy in its series CSEF Working Papers with number 333.
Date of creation: 25 Jun 2013
Date of revision:
sets; asymmetric information; information sharing;
Find related papers by JEL classification:
- C71 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Cooperative Games
- D51 - Microeconomics - - General Equilibrium and Disequilibrium - - - Exchange and Production Economies
- D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design
This paper has been announced in the following NEP Reports:
- NEP-ALL-2013-07-05 (All new papers)
- NEP-CTA-2013-07-05 (Contract Theory & Applications)
- NEP-GTH-2013-07-05 (Game Theory)
- NEP-MIC-2013-07-05 (Microeconomics)
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