The Library
Allocation mechanisms, incentives, and endemic institutional externalities
Tools
Hammond, Peter J. (2018) Allocation mechanisms, incentives, and endemic institutional externalities. Working Paper. Coventry: University of Warwick. Department of Economics. Warwick economics research papers series (WERPS) (1162).
|
PDF
WRAP-allocation-mechanisms-incentives-endemic-institutional-externalities-Hammond-2018.pdf - Other - Requires a PDF viewer. Download (775Kb) | Preview |
Official URL: https://warwick.ac.uk/fac/soc/economics/research/w...
Abstract
Whether an economic agent’s decision creates an externality often depends on the institutional context in which the decision was made. Indeed, in orthodox economics, a technological or exogenous externality occurs just in case one agent’s economic welfare or production possibilities are directly affected by the market decisions of other agents. A pecuniary externality occurs just in case one consumer’s economic welfare or producer’s profit is affected indirectly by price changes caused by changes in other agents’ decisions. Similarly, an institutional or endogenous externality may arise whenever allocations are determined by a mechanism that is not strategy proof for some agent. Then even a resource balance constraint creates an institutional externality except in special cases such as when no individual agent’s action can affect market clearing prices — i.e., there are no pecuniary externalities.
Item Type: | Working or Discussion Paper (Working Paper) | ||||||
---|---|---|---|---|---|---|---|
Subjects: | H Social Sciences > HB Economic Theory | ||||||
Divisions: | Faculty of Social Sciences > Economics | ||||||
Library of Congress Subject Headings (LCSH): | Externalities (Economics), Hurwicz, Leonid -- Influence | ||||||
Series Name: | Warwick economics research papers series (WERPS) | ||||||
Publisher: | University of Warwick. Department of Economics | ||||||
Place of Publication: | Coventry | ||||||
ISSN: | 0083-7350 | ||||||
Official Date: | April 2018 | ||||||
Dates: |
|
||||||
Number: | 1162 | ||||||
Number of Pages: | 15 | ||||||
Institution: | University of Warwick | ||||||
Status: | Not Peer Reviewed | ||||||
Publication Status: | Published | ||||||
Access rights to Published version: | Open Access (Creative Commons) | ||||||
Date of first compliant deposit: | 12 March 2018 | ||||||
Date of first compliant Open Access: | 12 March 2018 | ||||||
Version or Related Resource: | This paper also appears as CRETA discussion paper 42 |
Request changes or add full text files to a record
Repository staff actions (login required)
View Item |