Minimal entropy and uniqueness of price equilibria in a pure exchange economy

DOI10.1016/J.JMATECO.2021.102555MaRDI QIDQ2057271zbMATH OpenOpenAlexFDO

Authors Andrea Loi, Stefano Matta

Publication date 9 December 2021

Published in Journal of Mathematical Economics (Search for Journal in Brave)

Full work available at URL https://arxiv.org/abs/2102.09827

zbMATH Keywords

entropyequilibrium manifoldminimal submanifoldprice multiplicityuniqueness of equilibrium

Mathematics Subject Classification ID

Microeconomic theory (price theory and economic markets) (91B24)

Abstract: We introduce uncertainty into a pure exchange economy and establish a connection between Shannon's differential entropy and uniqueness of price equilibria. The following conjecture is proposed under the assumption of a uniform probability distribution: entropy is minimal if and only if the price is unique for every economy. We show the validity of this conjecture for an arbitrary number of goods and two consumers and, under certain conditions, for an arbitrary number of consumers and two goods.

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Cited in

(5)

• Uniqueness of asset prices in an exchange economy with unbounded utility
• A Remark on Conjectural Equilibria
• Equilibrium selection under changes in endowments: a geometric approach
• Risk aversion and uniqueness of equilibrium in economies with two goods and arbitrary endowments
• Recent advances on uniqueness of competitive equilibrium

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