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Benefit function and individual preferences. A generalization of the zero-maximum principle


  • Juan Aparicio
  • Jesus T. Pastor


In this paper we show that given a utility threshold Luenberger’s benefit function correctly represents individual preferences as long as specific reference commodity bundles are considered. We further show a condition which is sufficient for reaching Pareto optimality that generalizes the zero-maximum principle proposed by Luenberger. Under our hypothesis, the social benefit could be positive, negative or zero, and not necessarily always zero.

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  • Juan Aparicio & Jesus T. Pastor, 2012. "Benefit function and individual preferences. A generalization of the zero-maximum principle," Economics and Business Letters, Oviedo University Press, vol. 1(1), pages 12-20.
  • Handle: RePEc:ove:journl:aid:9228

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    References listed on IDEAS

    1. Luenberger, David G., 1992. "Benefit functions and duality," Journal of Mathematical Economics, Elsevier, vol. 21(5), pages 461-481.
    2. Jean-Michel Courtault & Bertrand Crettez & Naila Hayek, 2007. "A Note On Luenberger'S Zero-Maximum Principle For Core Allocations," International Game Theory Review (IGTR), World Scientific Publishing Co. Pte. Ltd., vol. 9(03), pages 453-460.
    3. Robert G. Chambers & Rolf Färe, 1998. "Translation homotheticity," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 11(3), pages 629-641.
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