【正文】 The solution concept Prices and the Core An exchange economy Why pricetaking? View the population... Q 2 Q 1 ...as n separate individuals Q 0 A coalition... The coalition concept gives us an important clue. ...is formed by any subgroup we39。n39。n39。s look at the inner workings... Building an Edgeworth box x1a R1a R2a x2a Oa ? The situation from Alf39。ve got our endowments with us ? One day you take your bundle along to the swap shop... ? ...and some bossy person is there who proposes (insists on?) a particular feasible allocation. ? You and some others don39。 Arthur Bill 39。Bill} ... plus some new ones All the old coalitions are possible... Will these still be core allocations in the 4person economy? ? B ? A Alf 39。ll redraw the Edgeworth box Some puzzles in petitive equilibrium analysis General equilibrium Robinson Crusoe’s problem Decentrali sation and Trade A manyperson Economy Why pricetaking? Excess demand The solution concept Prices and the Core An exchange economy Why pricetaking? D E O a x 2 a x 1 a D E x 1 a x 2 a x 1 b O b O a D E x 2 b x 1 b O b What would I do out of equilibrium? And what would he do? Let39。t like the x bundle you would get under this allocation... ? ...and you find that by using just the resources you all own you could all get a utility level at least as high as that offered to you under the proposed allocation. ? You guys therefore refuse to