Economics thoughts

[zunger]

Technical rambly post.

So last night I started reading MWG on microeconomics. One of the things which struck me was their use of a rather artificial-feeling mathematical framework, with consumption being a function of prices (a vector in an L-dimensional space) and of wealth (a single real number). Various bits of math follow from the statement

Comments

[firestorm717]

Yeah, the mathematical formalism is a bit much. I think usually what happens is that one of the prices in the price vector gets normalized to 1 and is considered the numeraire/money. How would you write out a bartering system? You'd have to define relative prices for every pair...which would be quite cumbersome. Maybe you can choose a few base commodities as your scale to deal with non-corporeal goods like loyalty.

(I say money can buy loyalty...for some people :P just set p = Infinity for everyone else).