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Core rationalizability in two-agent exchange economies

Author

Listed:
  • Walter Bossert

    (Département de Sciences Economiques and C.R.D.E., Université de Montréal, C.P. 6128, succursale Centre-ville, Montréal QC H3C 3J7, CANADA)

  • Yves Sprumont

    (Département de Sciences Economiques and C.R.D.E., Université de Montréal, C.P. 6128, succursale Centre-ville, Montréal QC H3C 3J7, CANADA)

Abstract

We provide a characterization of selection correspondences in two-person exchange economies that can be core rationalized in the sense that there exists a preference profile with some standard properties that generates the observed choices as the set of core elements of the economy for any given endowment vector. The approach followed in this paper deviates from the standard rational choice model in that a rationalization in terms of a profile of individual orderings rather than in terms of a single individual or social preference relation is analyzed.

Suggested Citation

  • Walter Bossert & Yves Sprumont, 2002. "Core rationalizability in two-agent exchange economies," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 20(4), pages 777-791.
    • Handle: RePEc:spr:joecth:v:20:y:2002:i:4:p:777-791
    Note: Received: April 20, 2000; revised version: September 25, 2001
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    References listed on IDEAS

    as
    1. Ray, Indrajit & Zhou, Lin, 2001. "Game Theory via Revealed Preferences," Games and Economic Behavior, Elsevier, vol. 37(2), pages 415-424, November.
    2. SPRUMONT, Yves, 1999. "Paretian Quasi-Orders: Two Agents," Cahiers de recherche 9903, Universite de Montreal, Departement de sciences economiques.
    3. Donald J. Brown & Rosa L. Matzkin, 2008. "Testable Restrictions on the Equilibrium Manifold," Lecture Notes in Economics and Mathematical Systems, in: Computational Aspects of General Equilibrium Theory, pages 11-25, Springer.
    4. Sprumont, Yves, 2000. "On the Testable Implications of Collective Choice Theories," Journal of Economic Theory, Elsevier, vol. 93(2), pages 205-232, August.
    5. Amartya K. Sen, 1971. "Choice Functions and Revealed Preference," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 38(3), pages 307-317.
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    Cited by:

    1. Ray, Indrajit & Snyder, Susan, 2013. "Observable implications of Nash and subgame-perfect behavior in extensive games," Journal of Mathematical Economics, Elsevier, vol. 49(6), pages 471-477.
    2. Walter Bossert & Yves Sprumont, 2009. "Non‐Deteriorating Choice," Economica, London School of Economics and Political Science, vol. 76(302), pages 337-363, April.
    3. Ruediger Bachmann, 2006. "Testable Implications of Pareto Efficiency and Individualrationality," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 29(3), pages 489-504, November.
    4. Ray, Indrajit & Snyder, Susan, 2013. "Observable implications of Nash and subgame-perfect behavior in extensive games," Journal of Mathematical Economics, Elsevier, vol. 49(6), pages 471-477.
    5. Thomas Demuynck, 2014. "The computational complexity of rationalizing Pareto optimal choice behavior," Social Choice and Welfare, Springer;The Society for Social Choice and Welfare, vol. 42(3), pages 529-549, March.
    6. Ray, Indrajit & Snyder, Susan, 2013. "Observable implications of Nash and subgame-perfect behavior in extensive games," Journal of Mathematical Economics, Elsevier, vol. 49(6), pages 471-477.
    7. Bachmann, Ruediger, 2006. "Testable implications of coalitional rationality," Economics Letters, Elsevier, vol. 93(1), pages 101-105, October.
    8. Pierre-André Chiappori & Olivier Donni, 2005. "Learning From a Piece of Pie: The Empirical Content of Nash Bargaining," THEMA Working Papers 2006-07, THEMA (THéorie Economique, Modélisation et Applications), Université de Cergy-Pontoise.
    9. Bossert, Walter & Sprumont, Yves, 2003. "Efficient and non-deteriorating choice," Mathematical Social Sciences, Elsevier, vol. 45(2), pages 131-142, April.
    10. Carvajal, Andres & Ray, Indrajit & Snyder, Susan, 2004. "Equilibrium behavior in markets and games: testable restrictions and identification," Journal of Mathematical Economics, Elsevier, vol. 40(1-2), pages 1-40, February.
    11. BOSSERT, Walter & SUZUMURA, Kotaro, 2006. "Non-Deteriorating Choice without Full Transitivity," Cahiers de recherche 2006-13, Universite de Montreal, Departement de sciences economiques.
    12. T. Demuynck, 2006. "Existence of closed and complete extensions applied to convex, homothetic an monotonic orderings," Working Papers of Faculty of Economics and Business Administration, Ghent University, Belgium 06/407, Ghent University, Faculty of Economics and Business Administration.
    13. Arlegi, Ricardo & Teschl, Miriam, 2022. "Pareto rationalizability by two single-peaked preferences," Mathematical Social Sciences, Elsevier, vol. 118(C), pages 1-11.

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    More about this item

    Keywords

    Collective rationality; Cores; Exchange economies.;
    All these keywords.

    JEL classification:

    • D51 - Microeconomics - - General Equilibrium and Disequilibrium - - - Exchange and Production Economies

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