What This Document Is
This document contains comprehensive lecture notes from an advanced undergraduate economics course at the University of California, Berkeley (ECON 2). Specifically, these notes cover material from the second half of the course, focusing on advanced welfare economics within the framework of the Arrow-Debreu economy. It delves into theoretical concepts and proofs central to understanding optimal resource allocation and market equilibrium. The notes appear to be meticulously prepared, with revisions and annotations included.
Why This Document Matters
These lecture notes are an invaluable resource for students enrolled in similar advanced microeconomics or mathematical economics courses. They are particularly helpful for those seeking a deeper understanding of the theoretical underpinnings of welfare economics and general equilibrium theory. Students preparing for exams, working on problem sets, or needing a detailed reference for complex concepts will find these notes exceptionally useful. Access to these notes can significantly enhance comprehension and provide a strong foundation for further study in economic theory.
Topics Covered
* The Second Welfare Theorem
* Pareto Optimality in Pure Exchange Economies
* Walrasian Equilibrium with Transfers
* Minkowski’s Theorem and its application to economics
* Conditions for Price Positivity
* Affordability Constraints and Income Transfers
* Strong Monotonicity and its implications
* Continuity and Completeness in Preference Relations
What This Document Provides
* A detailed outline of the proof for the Second Welfare Theorem.
* Formal definitions and explanations of key economic concepts.
* Logical progressions of arguments and derivations.
* Supporting lemmas and their proofs to reinforce theoretical understanding.
* A rigorous treatment of mathematical conditions necessary for equilibrium existence and optimality.
* Annotations and revisions indicating areas of emphasis and clarification.
