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The Transfer Problem under Uncertainty: The Existence of Pareto-Improving Transfers

Forsythe, Robert and McCubbins, Mathew D. (1980) The Transfer Problem under Uncertainty: The Existence of Pareto-Improving Transfers. Social Science Working Paper, 325. California Institute of Technology , Pasadena, CA. (Unpublished) https://resolver.caltech.edu/CaltechAUTHORS:20171010-151741701

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Abstract

This paper examines the effect of a unilateral transfer on the welfare of two countries under uncertainty. The traditional welfare effects are summarized and extended for a pure exchange economy with complete contingent claims markets. It is demonstrated that the effects of a transfer in such an economy is isomorphic to the effects in the traditional certainty case where a unilateral transfer always decreases the welfare of the transferor and increases that of the transferee. Further, in the absence of a complete set of markets, examples are exhibited in which a unilateral transfer increases the welfare of both countries.


Item Type:Report or Paper (Working Paper)
Group:Social Science Working Papers
Series Name:Social Science Working Paper
Issue or Number:325
Record Number:CaltechAUTHORS:20171010-151741701
Persistent URL:https://resolver.caltech.edu/CaltechAUTHORS:20171010-151741701
Usage Policy:No commercial reproduction, distribution, display or performance rights in this work are provided.
ID Code:82266
Collection:CaltechAUTHORS
Deposited By: Jacquelyn Bussone
Deposited On:11 Oct 2017 18:18
Last Modified:03 Oct 2019 18:52

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