To Trade Or Not To Trade: Economies With A Variable Number Of Tradeables* | Zendy

Gilles Robert P. | Zendy; Diamantaras Dimitrios | Zendy

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To Trade Or Not To Trade: Economies With A Variable Number Of Tradeables*

Author(s) -

Gilles Robert P.,

Diamantaras Dimitrios

Publication year - 2003

Publication title -

international economic review

Language(s) - English

Resource type - Journals

SCImago Journal Rank - 2.658

H-Index - 86

eISSN - 1468-2354

pISSN - 0020-6598

DOI - 10.1111/1468-2354.t01-1-00105

Subject(s) - economics , commodity , production (economics) , pareto principle , microeconomics , general equilibrium theory , shadow price , shadow (psychology) , variable (mathematics) , set (abstract data type) , decentralization , market economy , psychology , mathematical optimization , mathematical analysis , operations management , mathematics , computer science , programming language , psychotherapist

We present a general equilibrium model that encompasses the endogenous selection and shadow‐pricing of a set of tradeable commodities, with home‐based and social production activities. In the model, a market system is a set of costly social institutions which embody the trade and production technologies available in the economy. Our equilibrium concept describes the pricing of market institutions, thus pricing the tradeability of a commodity. We obtain the existence and the decentralization of Pareto‐efficient allocations. We discuss an example regarding the transition of a guild‐based economy into a market‐based economy.

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