Abstract
We show that every (random) assignment/allocation without transfers can be considered as a market outcome with personalized prices and an equal income. One can thus evaluate an assignment by investigating the prices and the induced opportunity sets. When prices are proportional across agents, the assignment is efficient; when prices are common, the assignment is both efficient and envy-free. Moreover, this market perspective reveals a weakness of envy-freeness.
Keywords
allocation without transfers; competitive equilibrium; equal incomes; market perspective; envy-free; Pareto efficient; coalitional-envy-free; random assignment;
JEL codes
- C78: Bargaining Theory • Matching Theory
- D61: Allocative Efficiency • Cost–Benefit Analysis
- D63: Equity, Justice, Inequality, and Other Normative Criteria and Measurement
Replaced by
Yinghua He, Sanxi Li, and Jianye Yan, “Evaluating Assignment without Transfers: A Market Perspective”, Economics Letters, Elsevier, vol. 133, 2015, pp. 40–44.
Reference
Yinghua He, Sanxi Li, and Jianye Yan, “Evaluating Assignment without Transfers: A Market Perspective”, TSE Working Paper, n. 15-559, March 2015.
See also
Published in
TSE Working Paper, n. 15-559, March 2015