Efficiency, equity, and social rationality under uncertainty
نویسندگان
چکیده
منابع مشابه
Economic Rationality under Uncertainty
Though uncertainty pervades all aspects of life and human action, it has a rather short history in economics. Surprisingly, Daniel Bernoulli’s (1738) notion of expected utility, which suggests that (in games of chance) monetary risky ventures ought to be evaluated by the sum of utilities of outcomes weighted by the corresponding probabilities, was not immediately used in economic theory. Indeed...
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Both Behavioral Finance and market practitioners view confidence as one of the most important psychological variables influencing investor behavior. In the Behavioral Finance literature, confidence is associated with biased decisions and overreaction: investor confidence leads them to give too much importance to some ideas and to refuse to seriously take new facts into account until the grounds...
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The Pareto efficiency criterion is often in conflict with the equity criteria as no-envy or as egalitarian-equivalence: An allocation x that is Pareto superior to another allocation y can be inferior to y in consideration of equity. This paper formalizes two different principles of social choice under possible conflict of efficiency and equity. The efficiency-first principle requires that we sh...
متن کاملEquity, Envy and Efficiency under Asymmetric Information
The set of fair (i.e. envy free and efficient) allocation rules may be empty in wellbehaved pure exchange economies if the agents are asymmetrically informed at the time of contracting. In addition, there may exist efficient allocation rules such that every agent envies another.
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Recent macroeconomic research discusses credit market imperfections as a key channel through which inequality retards growth. Limited borrowing prevents the less affluent individuals from investing the efficient amount, and the inefficiencies are considered to become stronger as inequality rises. This paper, though, argues that higher inequality may actually boost aggregate output even with con...
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ژورنال
عنوان ژورنال: Economic Theory
سال: 2021
ISSN: 0938-2259,1432-0479
DOI: 10.1007/s00199-020-01335-4