# Questions tagged [theory]

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### Where does Arrow’s Impossibility Theorem standard proof rely on the existence of at least three alternatives?

I am trying to understand the proof of the world-famous Arrow’s Impossibility Theorem. To do that, I have been relying on Wikipedia’s proof by decisive coalition, as well as on the proof provided by ...
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1 vote
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### Kohlberg-Mertens theorem

I am trying to understand the Kohlberg-Mertens theorem. Here is the context and the theorem. We fix $N$ a set of players and $S_i$ the finite set of actions of each players with $\lvert S_i\rvert =m_i$...
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### Random Utility Model Multiple Choice Question. Which one is correct?

In this random utility model, which of the five statements is true? I've been thinking about this question ever since the exam... I said (B).
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1 vote
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### Reference for monotonicity: $x\geq y\implies x\succsim y$ and $x>y\implies x\succ y$

I've seen this definition for monotonicity many times on different papers and on this site: $x\geq y\implies x\succsim y$ and $x>>y\implies x\succ y$. However, what I read on MWG's ...
• 1,916
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### Inductive proofs in economics

Are there any thorems in economics which use proof by mathematical induction to prove them? I've noticed that there is nothing (to my knowledge) from a standard PhD microeconomic theory sequence which ...
• 8,407
1 vote
165 views

### Approximate Pareto efficiency with ordinal preferences

Pareto-efficiency is a very important property, but in some cases it cannot be attained (for example, when agents play a game such as the Prisonner's Dilemma). In such cases, it can be useful to ...
• 3,075
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### Screening models with multiple goods and interacting costs

I'm looking for a reference in the literature on monopolistic screening/mechanism design, where there are multiple allocative variables and these interact in the agent's utility function. For example, ...
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1 vote
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### Factor changes in Melitz (2003) model

What would be the effect of changes in factor supplies, for example labor, on the open economy equilibrium?
• 1,843
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### Does the Rybczynski theorem also hold in modern trade theory models?

Does the Rybczynski theorem also hold for modern Melitz (2003) type trade models?
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### Time series question from book (ma)

I'm trying to understand this subject and I'm stuck in a question found in a book. I understand white noise characterization, but I'm having some problems with this... maybe it's too much theory? I ...
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### Questions regarding Solving Melitz (2003) model

I am editing my question regarding solving the model in order to be more specific. Regarding the demand side, In the beginning of the model, we have a CES utility function over a continuum of goods ...
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1 vote