On the core and Walrasian expectations equilibrium in infinite dimensional commodity spaces

TL;DR

This paper characterizes Walrasian expectations allocations in an infinite-dimensional commodity space with asymmetric information, using coalition veto power and perturbation techniques.

Contribution

It provides two novel characterizations of Walrasian expectations allocations in Banach lattice commodity spaces under asymmetric information.

Findings

Characterization via Aubin non-dominated allocations

Equivalence with non-private domination by the grand coalition

Use of perturbations of initial endowments

Abstract

In this paper, we establish two different characterizations of Walrasian expectations allocations by the veto power of the grand coalition in an asymmetric information economy having finite numbers of agents and states of nature and whose commodity space is a Banach lattice. The first one deals with Aubin non-dominated allocations, and the other claims that an allocation is a Walrasian expectations allocation if and only if it is not privately dominated by the grand coalition, by considering perturbations of the original initial endowments in precise directions.