Radner's cost–benefit analysis in the small: A correction and new equivalences

Research output: Contribution to journalArticle

Abstract

Schlee (2013) asserts the equivalence between a local welfare measure proposed by Radner (1993) and the derivatives of six other welfare measures. The asserted equivalence between Radner's measure and one of these – Debreu's (1951) coefficient of resource utilization – is false. What is the case is that the other six local welfare measures are equivalent to a modification of Debreu's coefficient that applies to economies with distortions.

Original languageEnglish (US)
Pages (from-to)31-33
Number of pages3
JournalEconomics Letters
Volume172
DOIs
Publication statusPublished - Nov 1 2018

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Keywords

  • Benefit function
  • Coefficient of resource utilization
  • Local cost–benefit analysis

ASJC Scopus subject areas

  • Finance
  • Economics and Econometrics

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