Deep Projections and the Local Nature of the Cass Criterion (opens in new tab)

This paper defines the deep projections of the indifference and the offer hypersurfaces. These projections are used to measure how much the trade hyperplane must be curved to reach these other two canonical manifolds. In particular, it is shown that the factor $\lambda_{n}(p)\partial e(p,v_{n}(p))/\partial u>0$ measures how much more bent the offer hypersurface is relative to the indifference hypersurface, where $\lambda_{n}(\cdot)$ is the Lagra...