Social loss with respect to the core of an economy with externalities

Christian Pietro (), Maria Graziano and Vincenzo Platino
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Christian Pietro: Universitá degli Studi di Napoli Parthenope

Economic Theory, 2022, vol. 73, issue 2, No 7, 487-508

Abstract: Abstract We consider a pure exchange economy with externalities. We adopt a cooperative approach to equilibrium analysis, allowing each individual to cooperate with others and to form coalitions. Individual preferences are affected by the consumption of all other agents in the economy, and the consumption set of each agent is affected by the coalition to which he/she belongs. Following Montesano (Soc Choice Welf 19:763–767, 2002), we introduce a measure of social loss with respect to the $$\gamma $$ γ -core and $$\alpha $$ α -core of the economy which completely characterizes the corresponding core allocations.

Keywords: Exchange economy; Other-regarding preferences; Core; Social loss (search for similar items in EconPapers)
JEL-codes: C71 D11 D62 D64 (search for similar items in EconPapers)
Date: 2022
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Citations: View citations in EconPapers (3)

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Working Paper: Social Loss with Respect to the Core of an Economy with Externalities (2019)
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DOI: 10.1007/s00199-020-01293-x

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