Published October 9, 2017
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Ex Ante Optimality and Spot Market Economies
Abstract
Arrow's result linking ex ante Pareto optimality for a pure trade world to competitive equilibrium positions under a complete set of contingent claim markets is summarized, as is his reinterpretation of ex ante optimality for the case of an economy with active spot markets. Possible difficulties arising from this reinterpretation are noted. The final section of the paper examines conditions under which an economy with active spot markets will achieve an ex ante optimum in the original sense of this term and summarizes the behavior of such an economy.
Additional Information
This research was supported in part by the National Science Foundation under Grant No. DAR 7909933. We wish to thank Ted Groves, Walter Heller and Bob Forsythe for their comments.Attached Files
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Additional details
- Eprint ID
- 82183
- Resolver ID
- CaltechAUTHORS:20171006-141542433
- DAR-7909933
- NSF
- Created
-
2017-10-09Created from EPrint's datestamp field
- Updated
-
2019-10-03Created from EPrint's last_modified field
- Caltech groups
- Social Science Working Papers
- Series Name
- Social Science Working Paper
- Series Volume or Issue Number
- 365