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Second Theorem of Welfare Economics

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PPGPortal > Home > Concept Dictionary > S > Second Theorem of Welfare Economics
 
Second Theorem of Welfare Economics

States that if all agents have convex preferences, there will always be a set of prices such that each Pareto efficient allocation is a market equilibrium for an appropriate assignment of endowments.

(Benjamin, Dwayne. Class Lecture.  PPG 1002H Microeconomics for Policy Analysis, University of Toronto School of Public Policy and Governance.)
     
Second Theorem of Welfare Economics

States that if all agents have convex preferences, there will always be a set of prices such that each Pareto efficient allocation is a market equilibrium for an appropriate assignment of endowments.

(Benjamin, Dwayne. Class Lecture.  PPG 1002H Microeconomics for Policy Analysis, University of Toronto School of Public Policy and Governance.)

Approved for glossaryposting by Ben Eisen on December 5, 2010


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