Exchange (2): The Edgeworth Box and Pareto Efficient Allocations (Varian Figure 32.2)

[@nerminvarol7342]

finally found one resource explaining everything clearly! thank you!

[@IrisFranz]

Glad that it was helpful!

[@Hercules003]

I was lost with my lecturers eplanations so I delved into books and wasted time trying to understand something that you explained in 4 minutes! Thank you again.

[@sambee1504]

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[@hindcw55]

you are a QUEEN! I watched all your videos and it helped me a lot for my exam! thank you!

[@IrisFranz]

Happy to help!

[@keynesr]

Sending you love and prayer.... your videos are precise and simple

[@vijaykulhari_IITB]

I saw this video a day before my exam thanks for content

[@Ahmed-jl7uh]

Great and clear explanation! thanks a lot, keep going!

[@IrisFranz]

You’re welcome. Happy learning!

[@keshavkapoor4594]

Please keep making such videos!

[@IrisFranz]

Will be on my to-do list.

[@清怡朱]

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[@najmakawoosa8027]

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[@hendynail4877]

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[@IrisFranz]

Thank you!

[@Living_with_flavour]

hey, are pareto efficiency the walrasian equilibrium ?

[@jomp6141]

3:40 best justification ever XD

[@jackfu7284]

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[@choirunisaamalia8427]

May i ask what is contract curve?

[@IrisFranz]

Contract curve depicts the efficient allocations of the two goods, where the “contract” will occur. The initial allocation of two goods- the initial endowment, if somewhere away from the contract curve, will - through exchanges- move toward the contract curve.

[@choirunisaamalia8427]

@@IrisFranz does it have any relation with the budget constraint that we learn in indifference curve?

[@choirunisaamalia8427]

I thought the way to understand the Edgeworth box starts from understanding indifference curve (bcs apparently this box is where two indifference curve meet, right?) . I just dont see where the budget constraint in this box is. Could u help to elaborate pls 🙏😭

[@hendynail4877]

I think since this a pure exchange, a budget line is not necessarily because by definition, a pure(barter) exchange economy is one in which we only consumers and goods i.e no production, prices or money involved. Hence a budget line is not necessarily 🙂