Decentralization of the core through Nash equilibrium

Leonidas Koutsougeras and Nicholas Ziros

No 2008026, LIDAM Discussion Papers CORE from Université catholique de Louvain, Center for Operations Research and Econometrics (CORE)

Abstract: We show that in large finite economies, core allocations can be approximately decentralized as Nash (rather than Walras) equilibrium. We argue that this excrcise is an essential complement to asymptotic core equivalence results, because it implies that in some approximate sense individual attempts to manipulate the decentralizing prices cannot be beneficial, which fits precisely the interpretation of asymptotic core convergence, namely the emergence of price taking.

Keywords: core; Nash equilibrium; asymptotic proximity; decentralization. (search for similar items in EconPapers)
JEL-codes: C72 D43 D50 (search for similar items in EconPapers)
Date: 2008-05-01
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Persistent link: https://EconPapers.repec.org/RePEc:cor:louvco:2008026

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