Lone wolves in competitive equilibria (Q2217357)

The authors summary: ''This paper develops a class of equilibrium-independent predictions of competitive equilibrium with indivisibilities. Specifically, we prove an analogue of the \("\)lone wolf theorem\("\) of classical matching theory for the Baldwin and Klemperer model [\textit{E. Baldwin} and \textit{P. Klemperer}, Econometrica 87, No. 3, 867--932 (2019; Zbl 1422.91212)] of exchange economies with transferable utility, showing that any agent who does not participate in trade in some competitive equilibrium must receive her autarky payoff in every competitive equilibrium. Our results extend to approximate equilibria and to settings in which utility is only approximately transferable''.