The New Palgrave Dictionary of Economics

2018 Edition
| Editors: Macmillan Publishers Ltd

Correspondences

  • M. Ali Khan
Reference work entry
DOI: https://doi.org/10.1057/978-1-349-95189-5_261

Abstract

Correspondences are versatile mathematical objects for which a rich theory can be developed. They arise naturally in many diverse areas of applied mathematics, including economic theory. For example, an individual consumer’s demand correspondence associates with each price system the set of utility maximizing consumption plans. Similarly, an individual producer’s supply correspondence associates with each price system the set of profit-maximizing production plans. These individual responses are correspondences rather than functions because of the constancy of marginal rates of substitution in consumption and in production over a range of commodity bundles.

Keywords

Berge’s maximum theorem Brouwer’s fixed point theorem Correspondences Functions Kakutani’s fixed point theorem Lyapunov’s theorem 

JEL Classifications

C0 
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Copyright information

© Macmillan Publishers Ltd. 2018

Authors and Affiliations

  • M. Ali Khan
    • 1
  1. 1.