All Questions
Tagged with externalities efficient-markets
3 questions
0
votes
1
answer
50
views
Optimizing Lagrangian Function Subject to 4 Input/Output Constraints:
The objective function:
$$\text{utility}=U\left(x_{c}, y_{c}\right)$$
subject to,
$x_{o}=f\left(y_{i}\right)$
$y_{o}=g\left(x_{i}, x_{o}\right)$
$x_{c}+x_{i}=x_{o}+x^{*}$
$y_{c}+y_{i}=y_{o}+y^{*}$
...
- 264
4
votes
1
answer
133
views
Does the Efficient Market Hypothesis Solve the Tragedy of the Commons?
My layman understanding of the Efficient Market Hypothesis is that there is so much brain power focused on the maximization of profit in the marketplace, that the market will find the best solution ...
- 155
7
votes
4
answers
3k
views
Is market failure constant? What properly defines it?
My textbook defines market failure as when "the production or consumption of a good or service causes additional positive or negative externalities on a third party not involved in the economic ...
- 245