||Local Independence, Monotonicity, Incentive Compatibility and Axiomatic Characterization of Price-Money Message Mechanism
Urai, KenMurakami, Hiromi
Discussion Papers In Economics And Business
15 , 2017-04 , Discussion Papers In Economics And Business
To characterize money in a static economic model, it is known to be important to consider the agent-commodity double-infinity settings, i.e., the overlapping-generations framework. There does not seem to exist abundant literature, however, treating the axiomatic characterization problems for such monetary Walras allocations under the social choice and/or mechanism design settings. We show that the monetary Walras allocation for the economy with double infinities is characterized by weak Pareto-optimality, individual rationality and local independence or the monotonicity, or the incentive compatibility conditions of social choice correspondence among the allocation mechanisms with messages under the category theoretic approach in Sonnenschein (1974). We utilize Sonnenschein's market extension axiom for swamped economies that is closely related to the replica stability axiom of Thomson (1988). We can see how these conditions characterize the price-money message mechanism universally among a wide class of mechanisms, and efficiently in the sense that it has the minimal message spaces (price-money dictionary theorems). Moreover, by using the category theoretic framework, we can obtain the up-to-isomorphism uniqueness for such a dictionary object (isomorphism theorems).