Trade, expropriation and allocation
AbstractAllocation rules map preference profiles into allocations, whereas trading rules map preference profiles and allocations into allocations. It is shown that no allocation rule can derive from a trading rule based on voluntary trade and satisfying a weak efficiency condition. If the trading rule allows compulsory trade then the only allocation rules that can derive from a trading rule satisfying certain additional mild conditions are those having a hierarchy of dictators. These results contribute to accentuate the difference between centralized and decentralized allocation mechanisms.
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Bibliographic InfoPaper provided by EconWPA in its series Public Economics with number 0407004.
Length: 13 pages
Date of creation: 05 Jul 2004
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Note: Type of Document - pdf; pages: 13
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Allocation rules; Compulsory trade; Hierarchy of dictators; Trading rules;
Find related papers by JEL classification:
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