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Competitive equilibria and the grand coalition

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  • Hervés-Beloso, Carlos
  • Moreno-Garci­a, Emma

Abstract

This paper provides a new characterization of competitive equilibrium allocations based on the veto mechanism. The main theorem shows that, in pure exchange economies with a continuum of non-atomic agents, the competitive equilibria can be characterized by strengthening the veto power of the grand coalition, formed by all the agents in the economy. The welfare theorems are obtained as easy corollaries of our main result. Furthermore, in the case of finite economies, we show that the characterizations of the Walrasian equilibria based on the veto power of the grand coalition are particular cases of our main theorem.

Suggested Citation

  • Hervés-Beloso, Carlos & Moreno-Garci­a, Emma, 2008. "Competitive equilibria and the grand coalition," Journal of Mathematical Economics, Elsevier, vol. 44(7-8), pages 697-706, July.
    • Handle: RePEc:eee:mateco:v:44:y:2008:i:7-8:p:697-706
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    References listed on IDEAS

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    1. Brown, Donald J & Lewis, Lucinda M, 1981. "Myopic Economic Agents," Econometrica, Econometric Society, vol. 49(2), pages 359-368, March.
    2. Garcia-Cutrin, Javier & Herves-Beloso, Carlos, 1993. "A Discrete Approach to Continuum Economies," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 3(3), pages 577-583, July.
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    4. Carlos Hervés-Beloso & Emma Moreno-García & Nicholas C. Yannelis, 2006. "Characterization and incentive compatibility of Walrasian expectations equilibrium in infinite dimensional commodity spaces," Studies in Economic Theory, in: Charalambos D. Aliprantis & Rosa L. Matzkin & Daniel L. McFadden & James C. Moore & Nicholas C. Yann (ed.), Rationality and Equilibrium, pages 119-139, Springer.
    5. Mário Rui Páscoa & Carlos Hervés-Beloso & Emma Moreno-García, 1999. "Manipulation-proof equilibrium in atomless economies with commodity differentiation," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 14(3), pages 545-563.
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    7. Herves-Beloso, Carlos & Moreno-Garcia, Emma & Nunez-Sanz, Carmelo & Rui Pascoa, Mario, 2000. "Blocking Efficacy of Small Coalitions in Myopic Economies," Journal of Economic Theory, Elsevier, vol. 93(1), pages 72-86, July.
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    14. Herves-Beloso, Carlos & Moreno-Garcia, Emma & Yannelis, Nicholas C., 2005. "An equivalence theorem for a differential information economy," Journal of Mathematical Economics, Elsevier, vol. 41(7), pages 844-856, November.
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    Cited by:

    1. Achille Basile & Maria Gabriella Graziano, 2012. "Core Equivalences for Equilibria Supported by Non-linear Prices," CSEF Working Papers 309, Centre for Studies in Economics and Finance (CSEF), University of Naples, Italy.
    2. He, Wei & Yannelis, Nicholas C., 2015. "Equilibrium theory under ambiguity," Journal of Mathematical Economics, Elsevier, vol. 61(C), pages 86-95.
    3. Bhowmik, Anuj & Cao, Jiling, 2012. "Blocking efficiency in an economy with asymmetric information," Journal of Mathematical Economics, Elsevier, vol. 48(6), pages 396-403.
    4. Bhowmik, Anuj & Graziano, Maria Gabriella, 2015. "On Vind’s theorem for an economy with atoms and infinitely many commodities," Journal of Mathematical Economics, Elsevier, vol. 56(C), pages 26-36.
    5. Javier Hervés-Estévez & Emma Moreno-García, 2015. "On restricted bargaining sets," International Journal of Game Theory, Springer;Game Theory Society, vol. 44(3), pages 631-645, August.
    6. Pesce, Marialaura, 2014. "The veto mechanism in atomic differential information economies," Journal of Mathematical Economics, Elsevier, vol. 53(C), pages 33-45.
    7. Maria Graziano & Maria Romaniello, 2012. "Linear cost share equilibria and the veto power of the grand coalition," Social Choice and Welfare, Springer;The Society for Social Choice and Welfare, vol. 38(2), pages 269-303, February.
    8. Bhowmik, Anuj & Cao, Jiling, 2013. "Robust efficiency in mixed economies with asymmetric information," Journal of Mathematical Economics, Elsevier, vol. 49(1), pages 49-57.
    9. Bhowmik, Anuj & Saha, Sandipan, 2023. "Restricted bargaining sets in a club economy," MPRA Paper 119210, University Library of Munich, Germany.
    10. Bhowmik, Anuj & Kaur, Japneet, 2023. "Competitive equilibria and robust efficiency with club goods," Journal of Mathematical Economics, Elsevier, vol. 108(C).
    11. Hervés-Estévez, Javier & Moreno-García, Emma, 2012. "Some remarks on restricted bargaining sets," MPRA Paper 39385, University Library of Munich, Germany, revised 10 Jun 2012.

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