Episode Details

MIT 14.04 Intermediate Microeconomic Theory, Fall 2020
Instructor: Prof. Robert Townsend

View the complete course: https://ocw.mit.edu/courses/14-04-intermediate-microeconomic-theory-fall-2020/
YouTube Playlist: https://www.youtube.com/watch?v=XSTSfCs74bg&list=PLUl4u3cNGP63wnrKge9vllow3Y2OOOKqF

When there is pollution, missing markets, externalities in caring about the outcomes for other people (jealousy or altruism), or an infinite number of agents from overlapping generations of finite-lived agents, then the equivalence between the class of competitive equilibria with transfers and the set of Pareto optimal allocations can be broken. But likewise, the link can be restored with markets in rights and appropriate market design.

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