IDEAS home Printed from https://ideas.repec.org/p/osk/wpaper/1531r.html
   My bibliography  Save this paper

An Axiomatic Characterization of the Price-Money Message Mechanism

Author

Listed:
  • Ken Urai

    (Graduate School of Economics, Osaka University)

  • Hiromi Murakami

    (Graduate School of Economics, Osaka University)

Abstract

The axiomatic characterization of price or market equilibrium is one of the most important problems in the general equilibrium theory. There does not seem to exist, however, so many papers on the axiomatic characterization problem of monetary equilibrium. The overlapping-generations model with a double in nity of commodities and agents is one of the most fundamental frameworks for introducing money into an economic model, although a simple game-theoretic or welfare characterization on the role of money under competitive mechanism is widely known to be difficult. In this paper, we show that the informational efficiency axiomatic characterization as in Hurwicz (1960), Mount and Reiter (1974) and Sonnenschein (1974) is possible for the price-money competitive mechanism for overlapping- generations economies among the class of all allocation mechanisms with messages. In particular, the category theoretic universal mapping characterization in Sonnenschein (1974) is generalized and applied to the overlapping-generations framework through our monetary version of Debreu-Scarf's core limit theorem of Urai and Murakami (2015). Our argument is also closely related to the replica characterization approaches of Walrasian social choice mechanism like Thomson (1988) and Nagahisa (1994), and provides a comprehensive perspective on them.

Suggested Citation

  • Ken Urai & Hiromi Murakami, 2015. "An Axiomatic Characterization of the Price-Money Message Mechanism," Discussion Papers in Economics and Business 15-31-Rev., Osaka University, Graduate School of Economics, revised Mar 2016.
    • Handle: RePEc:osk:wpaper:1531r
    as

    Download full text from publisher

    File URL: http://www2.econ.osaka-u.ac.jp/library/global/dp/1531R.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Esteban, J., 1986. "A characterization of the core in overlapping-generations economies," Journal of Economic Theory, Elsevier, vol. 39(2), pages 439-456, August.
    2. Alexander Konovalov, 2005. "The core of an economy with satiation," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 25(3), pages 711-719, April.
    3. Ken Urai & Hiromi Murakami, 2014. "Replica Core Equivalence Theorem: An Extension of the Debreu-Scarf Limit Theorem to Double Infinity Monetary Economies," Discussion Papers in Economics and Business 14-35-Rev., Osaka University, Graduate School of Economics, revised Mar 2015.
    4. Ken Urai & Hiromi Murakami, 2014. "Replica Core Equivalence Theorem: An Extension of the Debreu-Scarf Limit Theorem to Double Infinity Monetary Economies," Discussion Papers in Economics and Business 14-35-Rev.2, Osaka University, Graduate School of Economics, revised May 2015.
    5. Aliprantis, Charalambos D. & Burkinshaw, Owen, 1990. "An overlapping generations model core equivalence theorem," Journal of Economic Theory, Elsevier, vol. 50(2), pages 362-380, April.
    6. Jordan, J. S., 1982. "The competitive allocation process is informationally efficient uniquely," Journal of Economic Theory, Elsevier, vol. 28(1), pages 1-18, October.
    7. Sonnenschein, Hugo, 1974. "An Axiomatic Characterization of the Price Mechanism," Econometrica, Econometric Society, vol. 42(3), pages 425-433, May.
    8. Osana, Hiroaki, 1978. "On the informational size of message spaces for resource allocation processes," Journal of Economic Theory, Elsevier, vol. 17(1), pages 66-78, February.
    9. Paul A. Samuelson, 1958. "An Exact Consumption-Loan Model of Interest with or without the Social Contrivance of Money," Journal of Political Economy, University of Chicago Press, vol. 66(6), pages 467-467.
    10. Mount, Kenneth & Reiter, Stanley, 1974. "The informational size of message spaces," Journal of Economic Theory, Elsevier, vol. 8(2), pages 161-192, June.
    11. Ken Urai & Hiromi Murakami, 2015. "An Axiomatic Characterization of the Price-Money Message Mechanism," Discussion Papers in Economics and Business 15-31, Osaka University, Graduate School of Economics.
    12. Gerard Debreu, 1963. "On a Theorem of Scarf," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 30(3), pages 177-180.
    13. Balasko, Yves & Shell, Karl, 1980. "The overlapping-generations model, I: The case of pure exchange without money," Journal of Economic Theory, Elsevier, vol. 23(3), pages 281-306, December.
    14. Thomson, William, 1988. "A study of choice correspondences in economies with a variable number of agents," Journal of Economic Theory, Elsevier, vol. 46(2), pages 237-254, December.
    15. Toshihiko Hayashi, 1976. "Monetary Equilibrium in Two Classes of Stationary Economies," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 43(2), pages 269-284.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Kohzo Shiraishi & Ken Urai & Hiromi Murakami, 2018. "Stability and Universal Implementability of the Price Mechanism," Discussion Papers in Economics and Business 18-16, Osaka University, Graduate School of Economics.
    2. Ken Urai & Hiromi Murakami, 2017. "Local Independence, Monotonicity, Incentive Compatibility and Axiomatic Characterization of Price-Money Message Mechanism," Discussion Papers in Economics and Business 17-08, Osaka University, Graduate School of Economics.
    3. Urai, Ken & Murakami, Hiromi, 2016. "Replica core equivalence theorem: An extension of the Debreu–Scarf limit theorem to double infinity monetary economies," Journal of Mathematical Economics, Elsevier, vol. 66(C), pages 83-88.
    4. Kohzo Shiraishi & Ken Urai & Hiromi Murakami, 2017. "Stability and Universal Implementability of the Price Mechanism," Discussion Papers in Economics and Business 17-09, Osaka University, Graduate School of Economics.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Ken Urai & Hiromi Murakami, 2015. "An Axiomatic Characterization of the Price-Money Message Mechanism," Discussion Papers in Economics and Business 15-31, Osaka University, Graduate School of Economics.
    2. Ken Urai & Hiromi Murakami, 2016. "Local Independence, Monotonicity and Axiomatic Characterization of Price-Money Message Mechanism," Discussion Papers in Economics and Business 16-08, Osaka University, Graduate School of Economics.
    3. Ken Urai & Hiromi Murakami, 2017. "Local Independence, Monotonicity, Incentive Compatibility and Axiomatic Characterization of Price-Money Message Mechanism," Discussion Papers in Economics and Business 17-08, Osaka University, Graduate School of Economics.
    4. Urai, Ken & Murakami, Hiromi, 2016. "Replica core equivalence theorem: An extension of the Debreu–Scarf limit theorem to double infinity monetary economies," Journal of Mathematical Economics, Elsevier, vol. 66(C), pages 83-88.
    5. Ken Urai & Hiromi Murakami, 2014. "Replica Core Equivalence Theorem: An Extension of Debreu-Scarf Limit Theorem to Double Infinity Monetary Economies," Discussion Papers in Economics and Business 14-35, Osaka University, Graduate School of Economics.
    6. Kohzo Shiraishi & Ken Urai & Hiromi Murakami, 2018. "Stability and Universal Implementability of the Price Mechanism," Discussion Papers in Economics and Business 18-16, Osaka University, Graduate School of Economics.
    7. Kohzo Shiraishi & Ken Urai & Hiromi Murakami, 2016. "Universality and Efficiency of Price Mechanism based on an Expansion Possibility of Economies," Discussion Papers in Economics and Business 16-10, Osaka University, Graduate School of Economics.
    8. Charalambos Aliprantis & Kim Border & Owen Burkinshaw, 1996. "Market economies with many commodities," Decisions in Economics and Finance, Springer;Associazione per la Matematica, vol. 19(1), pages 113-185, March.
    9. Ken Urai & Hiromi Murakami, 2014. "Replica Core Equivalence Theorem: An Extension of the Debreu-Scarf Limit Theorem to Double Infinity Monetary Economies," Discussion Papers in Economics and Business 14-35-Rev.2, Osaka University, Graduate School of Economics, revised May 2015.
    10. Engineer, Merwan & Esteban, Joan & Sakovics, Jozsef, 1997. "Costly transfer institutions and the core in an overlapping generations model," Journal of Economic Behavior & Organization, Elsevier, vol. 32(2), pages 287-300, February.
    11. Hiromi Murakami & Ken Urai, 2017. "Replica core limit theorem for economies with satiation," Economic Theory Bulletin, Springer;Society for the Advancement of Economic Theory (SAET), vol. 5(2), pages 259-270, October.
    12. Kohzo Shiraishi & Ken Urai & Hiromi Murakami, 2017. "Stability and Universal Implementability of the Price Mechanism," Discussion Papers in Economics and Business 17-09, Osaka University, Graduate School of Economics.
    13. Hiromi Murakami & Ken Urai, 2016. "Replica Core Limit Theorem for Economy with Satiation," Discussion Papers in Economics and Business 16-09, Osaka University, Graduate School of Economics.
    14. Tian, Guoqiang, 2004. "On the Informational Requirements of Decentralized Pareto-Satisfactory Mechanisms in Economies with Increasing Returns," MPRA Paper 41226, University Library of Munich, Germany, revised Oct 2006.
    15. Athreya, Kartik B., 2014. "Big Ideas in Macroeconomics: A Nontechnical View," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262019736, April.
    16. Kenneth R. Mount & Stanley Reiter, 1996. "A lower bound on computational complexity given by revelation mechanisms (*)," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 7(2), pages 237-266.
    17. Manjunath, Vikram, 2016. "Fractional matching markets," Games and Economic Behavior, Elsevier, vol. 100(C), pages 321-336.
    18. Thomson, William, 2011. "Chapter Twenty-One - Fair Allocation Rules," Handbook of Social Choice and Welfare, in: K. J. Arrow & A. K. Sen & K. Suzumura (ed.), Handbook of Social Choice and Welfare, edition 1, volume 2, chapter 21, pages 393-506, Elsevier.
    19. Calsamiglia, Xavier & Kirman, Alan, 1993. "A Unique Informationally Efficient and Decentralized Mechanism with Fair Outcomes," Econometrica, Econometric Society, vol. 61(5), pages 1147-1172, September.
    20. Peter J. Hammond, 2003. "Equal rights to trade and mediate," Social Choice and Welfare, Springer;The Society for Social Choice and Welfare, vol. 21(2), pages 181-193, October.

    More about this item

    Keywords

    Axiomatic Characterization; Resource Allocation Mechanism; Informational Efficiency; Monetary Equilibrium; Overlapping-Generations Model; Replica Core Equivalence; Universal Mapping Property;
    All these keywords.

    JEL classification:

    • C60 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - General
    • 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
    • E00 - Macroeconomics and Monetary Economics - - General - - - General

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:osk:wpaper:1531r. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: The Economic Society of Osaka University (email available below). General contact details of provider: https://edirc.repec.org/data/feosujp.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.