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p-Weakly constrained Pareto efficiency and aggregation in incomplete markets

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  • Chenghu Ma
  • Jiankang Zhang

Abstract

This paper studies aggregation and a weak form of optimality referring to the p-weakly constrained Pareto efficiency (p-WE) in stochastic finance economies with incomplete markets. We derive a representative agent utility function maximized at equilibrium and a characterization of the set of p-WE allocations. Moreover, we establish the correspondence between the set of competitive equilibrium allocations and the set of p-WE allocations. It is noted that these are accomplished for general time-state utility functions and without restrictions on the initial resource allocations. Copyright Springer-Verlag Berlin Heidelberg 2013

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  • Chenghu Ma & Jiankang Zhang, 2013. "p-Weakly constrained Pareto efficiency and aggregation in incomplete markets," Social Choice and Welfare, Springer;The Society for Social Choice and Welfare, vol. 41(3), pages 605-623, September.
    • Handle: RePEc:spr:sochwe:v:41:y:2013:i:3:p:605-623
    DOI: 10.1007/s00355-012-0695-x
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    References listed on IDEAS

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