The Equilibrium Existence Duality

Bibliographic Data

ID10177873
AuthorsElizabeth Baldwin (0000-0002-5353-1839, University of Oxford), Ravi Jagadeesan (0000-0002-2724-4393, Stanford University), Paul Klemperer (0000-0003-4372-2962, University of Oxford), Alexander Teytelboym (0000-0002-6570-1903, University of Oxford)
Year2022
Volume131
Issue6
Pages1440-1476
Publication date2022-11-10
Peer ReviewedYes
Open AccessNo
TypeARTICLE
VenueJournal of Political Economy (JOURNAL)
Journal identifiersISSN: 0022-3808 • E-ISSN: 1537-534X
PublisherUniversity of Chicago Press (PUBLISHER • US)
DOI10.1086/722935
OpenAlexW4308886063
LanguageEN
Citations received1
References cited50

We show that with indivisible goods, the existence of competitive equilibrium fundamentally depends on agents’ substitution effects, not their income effects. Our equilibrium existence duality allows us to transport results on the existence of competitive equilibrium from settings with transferable utility to settings with income effects. One consequence is that net substitutability—which is a strictly weaker condition than gross substitutability—is sufficient for the existence of competitive equilibrium. Further applications give new existence results beyond the case of (net) substitutes. Our results have implications for auction design

Competitive equilibrium · Duality (order theory · Economics · General equilibrium theory · Mathematical economics · Microeconomics · Net (polyhedron · Substitution (logic · Auction Theory and Applications · Computer Science · Consumer Market Behavior and Pricing · Game Theory and Voting Systems · Mathematics

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