1992 Reports

Robustly Efficient Equilibria in Non-Convex Economies

Chichilnisky, Graciela; Heal, Geoffrey M.

An economy has a robustly efficient marginal cost pricing equilibrium (mcpe) if it has an mcpe that is Pareto efficient and if this property is preserved under small variations in preferences endowments and technologies. We consider economies in which there is a finite number of equilibria, each of which varies continuously with preferences and endowments. We prove that there exist no robustly efficient marginal cost pricing equilibria.