# Questions tagged [pure-exchange-economy]

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### Fair and efficient allocation of “family goods”

Consider an exchange economy with two goods, e.g. home furniture (x) and electrical equipment (y). The interesting thing about these goods is that, when a family owns a bundle, all members of the ...
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### Pure exchange economy: Given an initial endowment are multiple equilibria possible?

Consider a pure exchange economy with two goods ($x_1,x_2$) and two consumers $A,B$. Both users have an initial endowment, $(\omega_1^A,\omega_2^A)$ and $(\omega_1^B,\omega_2^B)$ respectively. A price ...
We have a pure exchange economy, two consumers $A,B$ and two goods $x,y$. The utility functions are as follows $$u_A=\min\{x_A,y_A\}\qquad u_B=\min\{x_B,\sqrt{y_B}\}$$ The endowments are $$\omega_A=(... 0answers 247 views ### Pure exchange economy: Set of multiple equilibria endowments Initial endowments which can result in multiple equilibria in a pure exchange economy are explained here. Given a pure exchange economy, that is given the utility functions (which fulfil the usual ... 1answer 1k views ### Price ratio determined by endowments only? Am I right to say in an Exchange Economy with two consumers with identical preferences, the equilibrium price (WEA) of the two goods would be determined by availability of two goods, i.e, total ... 1answer 48 views ### Contract curve and Pareto frontier Consider an exchange economy with two agents. Each agent i \in \{1,2\} derives utility u^i(x_1,x_2) \in \mathbb R by consuming (x_1,x_2) \in \mathbb R_+^2. Let u_j^i(x_1,x_2) = \partial u^i(... 0answers 137 views ### How to find walrasian asignations? [closed] In a economy Arrow Debreau of pure exchange with two agents and two goods. With utility function of Leontief for agent B, where U_b(x_b,y_b)=\min(x_b,y_b); and for agent A a simple Cobb-Douglas U_a(... 0answers 134 views ### Endowment increases but utility reduces In an Edgeworth economy with two agents and two goods, Player A has endowment \left(a,\,0\right) and utility u_{A}\left(x_{1},\,x_{2}\right)=\min\left(\gamma x_{1},\,x_{2}\right) in which \gamma&... 1answer 6k views ### How does an import quota affect the demand / supply of currency? An import quota in an open economy might not have the desired affect of increasing the GDP as it increases the demand of domestic currency in the open market raising exchange rate. How does it happen ... 1answer 103 views ### A question about the exchange economy The question I am given is the following: Consider an economy that has only three goods, mineral water, orange juice, and wine available in ﬁxed amounts, and three agents, A, B and C. So in this ... 2answers 2k views ### Does the contract curve always have to connect the initial points on an edgeworth box? Why or why not? What if the contract curve goes out of bounds? In that case, do I assume it superimposes itself on the axes it is closest to? I hope this was clear. Not sure how to explain this other than visually...... 1answer 959 views ### Competitive equilibrium in an exchange economy with lexicographic preferences [closed] I am really stuck with this problem and not able to approach it. Any help will be much appreciated. I tried to draw edgeworth box with initial endowment point. I do know that for competitive ... 1answer 23 views ### Why can’t we know the specific outcome of an exchange economy with initial resource endowment? In a 2-person exchange economy we define the contract curve as the subset of all Pareto-efficient outcomes within the ‘lens’ bounded by both agents’ indifference curves through \vec{R} which is the ... 1answer 123 views ### Utility Possibility Frontier with two consumers and 3 commodities I am trying to solve the following problem: Consider a pure exchange economy with three commodities and two households with individual endowments:$$e_1=(1,2,3), e_2=(3,2,1), respectively, and ...
If agent A has utility function $u(x_1, x_2)$ and agent B has utility function $v(x_1, x_2)$, what are the equation(s) that characterize the Pareto-efficient allocation of goods in the Edgeworth box? ...