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Information and Economic Efficiency / Richard Arnott, Bruce Greenwald, Joseph E. Stiglitz.
- Format:
- Book
- Author/Creator:
- Arnott, Richard.
- Series:
- Working Paper Series (National Bureau of Economic Research) no. w4533.
- NBER working paper series no. w4533
- Language:
- English
- Subjects (All):
- Equilibrium (Economics).
- Welfare economics.
- Moral hazard.
- Physical Description:
- 1 online resource: illustrations (black and white);
- Place of Publication:
- Cambridge, Mass. National Bureau of Economic Research 1993.
- Cambridge, Massachusetts : National Bureau of Economic Research, 1993.
- Summary:
- Is an economy with adverse selection, moral hazard, or an incomplete set of risk markets "constrained" Pareto efficient? There are two sets of papers addressing this question, one asserting that, under seemingly quite general conditions, the economy is constrained Pareto efficient, the other (to which we have contributed) that it is not. In this paper, we delineate the differences in assumptions between the two sets of papers, and under our assumptions present an intuitive proof of the Pareto inefficiency of market equilibrium with moral hazard and identify what it is that the government can do that the market cannot.
- Notes:
- Print version record
- November 1993.
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