In this paper we investigate incentive aspects of a general price-setting equilibrium principle in production economies with increasing returns or more general types of non-convexities. We do so by introducing the notion of generalized mechanism. We allow preferences and individual endowments to be unknown to the planner. We present a simple generalized mechanism whose social equilibrium alloca...

In this paper, we studies the distribution of firm size by using a model based on Sato’s paper in 1970, and proved the static distribution of firm size satisfies Pareto distribution in its upper tail.

For four alternatives and an even number of individuals, we prove a conjecture in a companion paper: It is impossible for a social choice rule to satisfy all of (1) Pareto, (2) anonymity, (3) full domain, and (4) independence of some alternative, a relaxation of Arrow’s IIA. JEL Codes: D70, D71

We analyze markets in which the price of a traded commodity is such that the supply and the demand are unequal. Under standard assumptions, the agents then have single peaked preferences on their consumption or production choices. For such markets, we propose a class of Uniform Trade rules each of which determines the volume of trade as the median of total demand, total supply, and an exogenous...

For arrays of independent Pareto random variables, this paper establishes complete convergence for weighted partial sums for the smaller order statistics within each row. This result improves on past strong laws. Moreover, it shows that we can obtain a finite nonzero limit for our normalized partial sums under complete convergence even though the first moment of our order statistics is infinite.

This paper demonstrates the optimality of a non-maximal penalty in a hierarchical enforcement structure. The penalty is chosen by the social planner to maximize the probability of monitoring and to minimize the probability of transgression. We compare the optimal penalty levels with and without ex post flexibility wherein the players are allowed to alter their decision after they observe the so...

This paper studies the efficiency of equilibria in a productive OLG economy where the process of financial intermediation is characterized by costly state verification. Both competitive equilibria and Constrained Pareto Optimal allocations are characterized. It is shown that market outcomes can be socially inefficient, even when a weaker notion than Pareto optimality is considered.

Employing data on the assessed value of land in 1983 – 2005 Japan, we investigate the dynamical behavior in the high scale region of non-equilibrium systems. From the detailed quasi-balance and Gibrat's law, we derive a relation between the change of Pareto index and a symmetry in the detailed quasi-balance. The relation is confirmed in the empirical data nicely.

We study the energetics of isothermal ratchets which are driven by a chemical reaction between two states, and operate in contact with a single heat bath of constant temperature. We discuss generic aspects of energy transduction such as Onsager relations in the linear response regime as well as the efficiency and dissipation close to and far from equilibrium. In the linear response regime where...

We look at compulsory licensing of intellectual property as remedy for anti-competitive practice. We identify aspects of intellectual property that warrants a different remedy from those using general definitions and remedies for essential facility. Based on the analysis, we present a characterisation of optimal compulsory licensing for a simple market. ∗Department of Economics, University of A...