Recently, Journal of Economic Theory, an international top-ranking journal in the field of theoretical economics, publishes a paper entitled "The Individualistic Foundation of Equilibrium Distribution" by Sun Xiang, who is a distinguished researcher from the school of Economics and Management, WHU.

In this paper, Sun analyses the relationship between individualistic equilibrium at the micro level and distributional equilibrium at the macro scale, which is a fundamental problem of equilibrium in super-large scale economies. This paper proposes the concept of type-symmetric randomized equilibrium(TSRE), which provides the micro-foundation for equilibrium distribution. Notably, any equilibrium distribution in a large economy is to be uniquely determined by one TSRE if the agent space is modeled by the classical Lebesgue unit interval. This result will deepen the academic understanding of distributional equilibrium, that is, distributional equilibrium is essentially an individualistic equilibrium of mixed strategies, rather than individualistic equilibrium of pure strategies.

The paper is a stage achievement of Relative Saturation Conditions and Its Application in Game Theory, a National Natural Science Foundation of China project (Grant No. 71773087) hosted by Prof. Sun Xiang, which was co-authored by Prof. Sun Yeneng (National University of Singapore) and Prof. Yu Haomiao (Ryerson University, Toronto). The research was sponsored by the General Program of National Natural Science Foundation of China, and Fok Ying Tong Education Foundation for young teachers etc.. The Journal of Economic Theory published by Elsevier is a world-class economic journal and a A-award journal of School of Economics and Management, WHU.

Sun Xiang is a lecturer as well as a distinguished researcher from the Department of Mathematical Economics and Finance, School of Economics and Management. In recent years, he has been focusing on the research of basic theories such as game theory and mechanism design, and his achievements have been successively published in the Journal of Economic Theory, Theoretical Economics, Games and Economic Behavior, Advances in Mathematics, Journal of Economic Behavior & Organization, Economic Theory and other international top-ranking academic journals.

Link to the paper: https://doi.org/10.1016/j.jet.2020.105083

Written by: Shen Shixiong

Rewritten by: Zhang Ruoxi

Edited by: Wu Buer and Hu Sijia