Refinements and incentive efficiency in Walrasian models of insurance economies |
| |
| Institution: | 1. Yeshiva University, United States;2. Columbia Business School, United States;1. College of Economics and Management, Nanjing University of Aeronautics and Astronautics, Nanjing 211106, China;2. Department of Finance and Insurance, Lingnan University, 8 Castle Peak Road, Tuen Mun, Hong Kong;1. SAIF/(CAFR) and Mathematics Department, Shanghai Jiao Tong University, 211 Huaihai Road, Shanghai, 200030, China;2. Konstanz University, Universitätsstraße 10, 78464 Konstanz, Germany;1. School of Business Administration, University of Miami, United States;2. Department of Economics, Faculty of Economics and Business, University of Chile, Chile;1. Paris School of Economics, France;2. University of Paris 1, France;3. Sciences-Po, France;4. University College London, United Kingdom;5. Institute for Fiscal Studies, United Kingdom;1. School of Finance and Statistics, Hunan University, Changsha, China;2. School of Mathematics, Statistics and Actuarial Science, University of Kent, UK;1. Graduate School of Information Sciences, Tohoku University, 6-6-6 Aoba, Sendai, Miyagi 980-8579, Japan;2. School of Management, Tokyo University of Science, 1-11-2, Fujimi, Chiyoda, Tokyo 102-0071, Japan;3. Institute of Science and Engineering, Kanazawa University, Kakuma-machi, Kanazawa 920-1192, Japan |
| |
| Abstract: | The literature on Walrasian markets in large economies with adverse selection has used various equilibrium refinements, but has obtained no general incentive efficiency of equilibrium, namely when cross-subsidies are needed for efficiency. We show that the same refined equilibria may also be incentive inefficient even when general mechanisms that allow for such cross-subsidies are priced and can be traded. In the process, we also prove existence of some type of forward induction equilibria in this context. |
| |
| Keywords: | Walrasian markets Adverse selection Refinements Mechanisms |
| 本文献已被 ScienceDirect 等数据库收录！ |
|
