Martin Osborne; Ariel Rubinstein

Published On


Page Range

pp. 121–136


  • English

Print Length

15 pages

A market

This chapter, unlike in the previous one, assumes that the ownership of a house is recognized and protected. Each house is initially owned by some individual. Houses can be exchanged only with the mutual consent of both owners; no individual can force another individual to give up her house.

The model allows us to introduce the central economic idea of prices as a means of guiding the individuals to a reallocation of the houses in which no group of individuals want to voluntarily exchange their houses.


Martin J. Osborne

Professor Emeritus of Economics at University of Toronto

Ariel Rubinstein

Emeritus in School of Economics at Tel Aviv University
Professor of Economics at New York University