I am reading the definition of a price equilibrium with transfer in MWG on page 548, 524-5.
Consider two-consumer exchange economy. If social planner wants to transfer wealth, how does she achieve this?
Two consumers are born with some apples and oranges. So, the social planner lets these consumers sell at the going market place of what they are endowed with. Then, does she collect taxes and transfer wealth in this way?
It seems like this wealth transfer can be achieved also by directly reallocating the apples and oranges distributed among consumers.
I am not exactly getting the terms like "there be some wealth distribution" or "equilibrium with transfers", "wealth transfers". What does it mean to say, "there is an assignment of wealth levels with ...."?