Lecture 4 - Efficiency, Assets, and Time
recorded by: Yale University
published: March 17, 2012, recorded: October 2009, views: 3557
released under terms of: Creative Commons Attribution No Derivatives (CC-BY-ND)
Download yalemecon251f09_geanakoplos_lec04_01.mp4 (Video - generic video source 817.5 MB)
Download yalemecon251f09_geanakoplos_lec04_01.flv (Video 371.2 MB)
Download yalemecon251f09_geanakoplos_lec04_01.flv (Video 357.0 MB)
Download yalemecon251f09_geanakoplos_lec04_01_640x360_h264.mp4 (Video 213.6 MB)
Download yalemecon251f09_geanakoplos_lec04_01.wmv (Video 321.8 MB)
Report a problem or upload filesIf you have found a problem with this lecture or would like to send us extra material, articles, exercises, etc., please use our ticket system to describe your request and upload the data.
Enter your e-mail into the 'Cc' field, and we will keep you updated with your request's status.
Over time, economists' justifications for why free markets are a good thing have changed. In the first few classes, we saw how under some conditions, the competitive allocation maximizes the sum of agents' utilities. When it was found that this property didn't hold generally, the idea of Pareto efficiency was developed. This class reviews two proofs that equilibrium is Pareto efficient, looking at the arguments of economists Edgeworth and Arrow-Debreu. The lecture suggests that if a broadening of the economic model invalidated the sum of utilities justification of free markets, a further broadening might invalidate the Pareto efficiency justification of unregulated markets. Finally, Professor Geanakoplos discusses how Irving Fisher introduced two crucial ingredients of finance--time and assets--into the standard economic equilibrium model.
Link this pageWould you like to put a link to this lecture on your homepage?
Go ahead! Copy the HTML snippet !