CFDP 2090

Author(s): 
CFDP Title: 

A Design for Market Socialism


Publication Date: June, 2017

Pages: 26 pp

Abstract: 

Socialism is conceptualized as a society in which individuals cooperate, distinguished from capitalism, characterized as involving ubiquitous economic competition. Here, I embed a formal model of cooperation in an Arrow-Debreu model, using the Kantian optimization protocol, and define a Walras-Kant equilibrium, in which firms maximize profits, consumers choose demands for commodities in the usual utilitymaximizing fashion, and the state rents capital to firms. The labor-supply decision of workers, however, is arrived at using the cooperative protocol. Incomes are redistributed through a flat income tax. Walras-Kant equilibria, with any desired degree of income equality exist, are decentralizable, and are Pareto efficient.

Keywords:

Market socialism, General equilibrium, First welfare theorem, Cooperation, Kantian optimization


JEL Classifications:

D50, D59, D6, P2

JEL Classifications: D50D59