Center for Economic Research, Department of Economics, University of Minnesota
This paper studies economic equilibrium theory with a "uniformity
principle" constraining the magnitudes (prices, quantities, etc.) and the operations
(to perceive, evaluate, choose, communicate, etc.) that agents can use.
For the special case of computability constraints, all prices, quantities, preference
relations, utility functions, demand functions, etc. are required to be
computable by finite algorithms. Then we obtain sharper versions of several
traditional assertions on utility representation, existence of consumer demand
functions, the fundamental welfare theorems, characterizations of market excess
demands, and others. These positive results hold despite the fact that commodity
and price spaces are no longer topologically complete.
On the other hand, we give "computable counterexamples" to several traditional
assertions, including the existence of a competitive equilibrium.
The results can be interpreted as possibility and impossibility results in both
computability-bounded rationality and in computational economics.
Richter, M.K. and Wong, K., (1996), "Bounded Rationalities and Computable Economies", Discussion Paper No. 297, Center for Economic Research, Department of Economics, University of Minnesota.
Richter, Marcel K.; Wong, Kam-Chau.
Bounded Rationalities and Computable Economies.
Center for Economic Research, Department of Economics, University of Minnesota.
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