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Drèze equilibria and welfare maxima

Economic Theory, no. 1 (2010): 55-63

Cited by: 4|Views5

Abstract

We present an example of a production economy with incomplete markets, von Neumann–Morgenstern utility functions, and a unique Drèze equilibrium in order to illustrate and explain the following phenomenon. There exists a transfer scheme such that every shareholder’s utility after transfers and share adjustments increases the more the fi...More

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