Efficiency, Inessentiality and the ‘Debreu Property’ of Prices

  • Alistair Ulph
  • David Ulph
Part of the Theory and Decision Library book series (TDLU, volume 13)


The standard story one tells about the classical Debreu-economy, is that all agents trade with a single market dealing in all commodities including contingent and future commodities. An equilibrium for such an economy will determine unique exchange-ratios between commodities and also the amounts traded of each commodity by each household. The important feature of the classical Debreu-economy is that even if one envisages a different institutional arrangement in which there are many markets (distinguished, for example, by the date at which the market operates) nevertheless the set of equilibrium trades (and the exchange rates at which these take place) is unaffected by this alternative description. Thus the equilibria of the Debreu economy are ‘real’ in the standard sense that they depend only on the underlying technology and consumers preferences.


Transaction Cost Institutional Arrangement Competitive Equilibrium Monetary Economy Classical Dichotomy 
These keywords were added by machine and not by the authors. This process is experimental and the keywords may be updated as the learning algorithm improves.


Unable to display preview. Download preview PDF.

Unable to display preview. Download preview PDF.


  1. [1]
    Arrow, K.J. and Hahn, F.H., General Competitive Analysis, Oliver and Boyd, 1971.Google Scholar
  2. [2]
    Debreu, G., Theory of Value, Yale University Press, 1959.Google Scholar
  3. [3]
    Hahn, F.H., ‘Equilibrium with Transaction Costs’, Econometrica 39 (1971), 417–439.CrossRefGoogle Scholar
  4. [4]
    Hahn, F.H., ‘On Transaction Costs, Inessential Sequence Economies and Money’, Review of Economic Studies 40 (1973), 449–461.CrossRefGoogle Scholar
  5. [5]
    Kurz, M., ‘Equilibrium with Transaction Costs and Money in a Single-Market Exchange Economy’, Technical Report 51, Economic Series, Stanford, January 1972.Google Scholar
  6. [6]
    Kurz, M., ‘Equilibrium in a Finite Sequence of Markets with Transaction Cost’, Technical Report 52, Economic Series, Stanford, February 1972.Google Scholar
  7. [7]
    Kurz, M., ‘Arrow-Debreu Equilibrium of an Exchange Economy with Transaction Cost’, Working Paper 7, Economics Series, Stanford, April 1972.Google Scholar
  8. [8]
    Niehans, J., ‘Money and Barter in General Equilibrium with Transactions Costs’, A.E.R. 61 (1971), 773–783.Google Scholar
  9. [9]
    Starr, R. M., ‘Equilibrium and Demand for Media of Exchange in a Pure Exchange Economy with Transactions Costs’, Cowles Foundation Discussion Paper, 332, March 1972.Google Scholar
  10. [10]
    Starrett, D. A.. ‘Inefficiency and the Demand for “Money” in a Sequence Economy’, Review of Economic Studies 40 (1973), 437–448.CrossRefGoogle Scholar

Copyright information

© D. Reidel Publishing Company, Dordrecht, Holland 1977

Authors and Affiliations

  • Alistair Ulph
    • 1
  • David Ulph
    • 1
  1. 1.University of StirlingScotland

Personalised recommendations