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Weakening transferable utility: the case of non-intersecting Pareto curves
Transferable utility (TU) is a widely used assumption in economics. In this paper, we weaken the TU property to a setting where distinct Pareto frontiers have empty intersections. We call this the no-intersection property (NIP). We show that the NIP is strictly weaker than TU, but still allows to derive several desirable properties. We discuss the NIP in relation to several models where TU has turned out to be a key as- sumption: models of assortative matching, principal-agent models with asymmetric information, the Coase Independence Property and Becker’s Rotten Kid Theorem.
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- Published
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- Submitted version
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ECARESPages
41.0Place of publication
BelgiumDepartment affiliated with
- Economics Publications
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Universite Libre De BruxellesFull text available
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2020-02-07Usage metrics
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