Characterization and incentive compatibility of Walrasian expectations equilibrium in infinite dimensional commodity spaces
Carlos Hervés-Beloso,
Emma Moreno-García () and
Nicholas C. Yannelis ()
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Emma Moreno-García: Universidad de Salamanca
Nicholas C. Yannelis: University of Illinois
A chapter in Rationality and Equilibrium, 2006, pp 119-139 from Springer
Abstract:
Summary We consider a differential information economy with infinitely many commodities and analyze the veto power of the grand coalition with respect the ability of blocking non-Walrasian expectations equilibrium allocations. We provide two different Walrasian expectations equilibrium equivalence results. First by perturbing the initial endowments in a precise direction we show that an allocation is a Walrasian expectations equilibrium if and only if it is not “privately dominated” by the grand coalition. The second characterization deals with the fuzzy veto in the sense of Aubin but within a differential information setting. This second equivalence result provides a different characterization for the Walrasian expectations equilibrium and shows that the grand coalition privately blocks in the sense of Aubin any non Walrasian expectations equilibrium allocation with endowment participation rate arbitrarily close to the total initial endowment participation for every individual. Finally, we show that any no free disposal Walrasian expectations equilibria is coalitional Bayesian incentive compatible. Since the deterministic Arrow-Debreu-McKenzie model is a special case of the differential information economy model, one derives new characterizations of the Walrasian equilibria in economies with infinitely many commodities.
Keywords: Differential information economy; Walrasian expectations equilibrium; Radner equilibrium; Privately non-dominated allocations; Private core; Aubin private core; Coalitional Bayesian incentive compatibility (search for similar items in EconPapers)
Date: 2006
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Journal Article: Characterization and incentive compatibility of Walrasian expectations equilibrium in infinite dimensional commodity spaces (2005) 
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Persistent link: https://EconPapers.repec.org/RePEc:spr:steccp:978-3-540-29578-5_7
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DOI: 10.1007/3-540-29578-X_7
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