Short sales, destruction of resources, welfare

Nikolaos Kokonas, Herakles Polemarchakis

Research output: Contribution to journalArticle

1 Citation (Scopus)
114 Downloads (Pure)

Abstract

A reduction in the output of productive assets (trees) in some contingencies may expand the range of risks spanned by the payoffs of assets and allow for better risk sharing; which may compensate for the loss of output and support a Pareto superior allocation. Surprisingly, if short sales of assets are not allowed, improved risk sharing that results from the destruction of output does not suffice to support a Pareto superior allocation.
Original languageEnglish
Pages (from-to)120-124
Number of pages4
JournalJournal of Mathematical Economics
Volume67
Early online date29 Sep 2016
DOIs
Publication statusPublished - 1 Dec 2016

Keywords

  • short sales
  • destruction
  • welfare

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