Characterising competitive equilibrium in terms of opportunity

This paper analyses alternative profiles of opportunity sets for individuals in an exchange economy, without assuming that individuals’ choices reveal coherent preferences. It introduces the concept of a ‘market-clearing single-price regime’, representing a profile of opportunity sets consistent with competitive equilibrium. It also proposes an opportunity-based normative criterion, the Strong Opportunity Criterion, which is analogous with the core in preference-based analysis. It shows that every market-clearing single-price regime satisfies the Strong Opportunity Criterion and that, in the limit as an economy is replicated, only such regimes have this property.