Discrete Walrasian Exchange Process
In an exchange economy, we provide a discrete exchange process, which is Walrasian since the trades are given by the equilibrium allocation of the local equilibrium. We prove that this process attains a Pareto optimal allocation after a finite number of steps and the local equilibrium price then supports the Pareto optimal allocation. Furthermore, along the process, the allocation is feasible and the utility of each consumer is non-decreasing.
|Date of creation:||Dec 2009|
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