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Copyright

Martin Osborne; Ariel Rubinstein

Published On

2023-06-26

Page Range

pp. 137–156

Language

  • 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
https://orcid.org/0000-0001-8584-6176

Ariel Rubinstein

(author)
Emeritus in School of Economics at Tel Aviv University
Professor of Economics at New York University
https://orcid.org/0000-0003-1574-2659
https://arielrubinstein.org/