Decentralized Convex-Type Equilibrium in Nonconvex Models of Welfare Economics via Nonlinear Prices
نویسندگان
چکیده
The paper is devoted to applications of modern tools of variational analysis to equilibrium models of welfare economics involving nonconvex economies with infinite-dimensional commodity spaces. The main results relate to generalized/ extended second welfare theorems ensuring an equilibrium price support at Pareto optimal allocations. Based on advanced tools of generalized differentiation, we establish refined results of this type with the novel usage of nonlinear prices at the three types to optimal allocations: weak Pareto, Pareto, and strong Pareto. The usage of nonlinear ( vs. standard linear) prices allow us to decentralized price equilibria in fully nonconvex models similarly to linear prices in the classical Arrow-Debreu convex model of welfare economics. Mathematics Subject Classifications {2000): 91B50, 49J52.
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