Lone Wolves in Competitive Equilibria

22 Pages Posted: 3 Jan 2018

See all articles by Ravi Jagadeesan

Ravi Jagadeesan

Stanford University - Department of Economics

Scott Duke Kominers

Harvard University

Ross Rheingans-Yoo

Harvard University

Date Written: December 23, 2017


This paper develops a class of equilibrium-independent predictions of competitive equilibrium with indivisibilities. Specifically, we prove an analogue of the “Lone Wolf Theorem” of classical matching theory, showing that when utility is perfectly transferable, any agent who does not participate in trade in one competitive equilibrium must receive her autarky payoff in every competitive equilibrium. Our results extend to approximate equilibria and to settings in which utility is only approximately transferable.

Keywords: Indivisibilities; Matching; Lone Wolf Theorem

JEL Classification: C78, D47, D51

Suggested Citation

Jagadeesan, Ravi and Kominers, Scott Duke and Rheingans-Yoo, Ross, Lone Wolves in Competitive Equilibria (December 23, 2017). Harvard Business School Entrepreneurial Management Working Paper No. 18-055, Available at SSRN: https://ssrn.com/abstract=3095542 or http://dx.doi.org/10.2139/ssrn.3095542

Ravi Jagadeesan

Stanford University - Department of Economics ( email )

Landau Economics Building
579 Serra Mall
STANFORD, CA 94305-6072
United States

Scott Duke Kominers (Contact Author)

Harvard University ( email )

Rock Center
Harvard Business School
Boston, MA 02163
United States

HOME PAGE: http://www.scottkom.com/

Ross Rheingans-Yoo

Harvard University ( email )

1875 Cambridge Street
Cambridge, MA 02138
United States

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