Theoretical Economics

Journal of the Econometric Society

Edited by: Federico Echenique • ISSN (e): 1555-7561 • ISSN (print): 1933-6837

Theoretical Economics: Oct, 2015, Volume 10, Issue 3

Gross substitutes and endowed assignment valuations

https://doi.org/10.3982/TE1840
p. 853-865

Michael Ostrovsky, Renato Paes Leme

We show that the class of preferences satisfying the Gross Substitutes condition of Kelso and Crawford (1982) is strictly larger than the class of Endowed Assignment Valuations of Hatfield and Milgrom (2005), thus resolving the open question posed by the latter paper. In particular, our result implies that not every substitutable valuation function can be "decomposed" into a combination of unit-demand valuations.


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