Indivisible commodities and an equivalence theorem on the strong core

Tomoki Inoue
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Tomoki Inoue: Center for Mathematical Economics, Bielefeld University

No 417, Center for Mathematical Economics Working Papers from Center for Mathematical Economics, Bielefeld University

Abstract: We consider a pure exchange economy with finitely many indivisible commodities that are available only in integer quantities. We prove that in such an economy with a sufficiently large number of agents, but finitely many agents, the strong core coincides with the set of cost-minimized Walras allocations. Because of the indivisibility, the preference maximization does not imply the cost minimization. A cost-minimized Walras equilibrium is a state where, under some price vector, all agents satisfy both the preference maximization and the cost minimization.

Keywords: Cost-minimized Walras equilibrium; Core equivalence; Indivisible commodities; Strong core (search for similar items in EconPapers)
Date: 2011-08-16
New Economics Papers: this item is included in nep-gth
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Citations: View citations in EconPapers (2)

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