Copyright
Martin Osborne; Ariel RubinsteinPublished On
2023-06-26Page Range
pp. 137–156Language
- English
Print Length
19 pages
An exchange economy
Chapter of: Models in Microeconomic Theory: Expanded Second Edition (He) (pp. 137–156)
This chapter discusses a market in which the goods can be consumed in any quantity: they are divisible. As in the previous chapter, the ownership of goods is recognized and protected.
Each individual initially owns a bundle of goods. We look for a distribution of the goods among the individuals and a price system with the property that for each good the total amount the individuals want to purchase is equal to the total amount other individuals want to sell: demand and supply are equal.
Contributors
Martin J. Osborne
(author)Professor Emeritus of Economics at University of Toronto
Ariel Rubinstein
(author)Emeritus in School of Economics at Tel Aviv University
Professor of Economics at New York University