Abstract:

In this paper we study finite-agent exchange economies. We extend the classical model by adding an imports-exports vector, which defines the markets clearing conditions of the economy. Equipped with this new definition, self-consistency properties are naturally defined. We show that the Core correspondence and the Walrasian allocations correspondence are self-consistent. In addition, we present an axiomatic characterization of the Walrasian allocations correspondence for a class of convex and smooth economies. All the axioms presented in the characterization are satisfied by the Core, except for a converse-consistency property, which can be interpreted as a requirement of decentralization.