Core and Walrasian equilibria when agents' characteristics are extremely dispersed

Konrad Podczeck

Economic Theory, 2003, vol. 22, issue 4, 699-725

Abstract: It is shown that core-Walras equivalence fails whenever the commodity space is a non-separable Banach space. The interpretation is that a large number of agents guarantees core-Walras equivalence only if there is actually a large number of agents relative to the size of the commodity space. Otherwise a large number of agents means that agents' characteristics may be extremely dispersed, so that the standard theory of perfect competition fails. Supplementing the core-Walras non-equivalence result, it is shown that in the framework of economies with weakly compact consumption sets – as developed by Khan and Yannelis (1991) – the core is always non-empty, even if consumption sets are non-separable. Copyright Springer-Verlag Berlin Heidelberg 2003

Keywords: Keywords and Phrases: Non-separable commodity space; Measure space of agents; Core; Walrasian equilibrium; Core-Walras equivalence.; JEL Classification Numbers: C62; C71; D41; D50. (search for similar items in EconPapers)
Date: 2003
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Citations: View citations in EconPapers (16)

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DOI: 10.1007/s00199-002-0354-z

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