Financial intermediation and the welfare theorems in incomplete markets
研究了在不完全市场的生产经济中，股东对公司目标存在分歧，而一个弱金融中介通过提供定制化合同解决分歧，恢复生产效率并实现帕累托有效市场结果，表明第一福利定理不依赖完全市场，但第二福利定理因市场不完全导致的非凸性而失效。
Abstract In production economies with incomplete markets, shareholders disagree about the objective of the firm. We show that a weak financial intermediary, who is unable to complete markets, can offer just enough spanning to resolve this disagreement. The intermediary is limited to offering one customized contract per consumer. Knowledge of demand functions is sufficient for offering the right contracts. Once agreement among shareholders is reached, productive efficiency is restored, which in turn permits a Pareto efficient market outcome. This result shows that the first welfare theorem does not depend on complete spanning, but merely on institutions that provide the right span. However, this cannot be said about the second welfare theorem: For some wealth distributions, equilibria with transfers fail to exist due to nonconvexities caused by market incompleteness.