The New Palgrave Dictionary of Economics

2018 Edition
| Editors: Macmillan Publishers Ltd

Shapley–Folkman Theorem

  • Ross M. Starr
Reference work entry
DOI: https://doi.org/10.1057/978-1-349-95189-5_1904

Abstract

The Shapley–Folkman theorem places an upper bound on the size of the non-convexities (loosely speaking, openings or holes) in a sum of non-convex sets in Euclidean N-dimensional space, RN. The bound is based on the size of nonconvexities in the sets summed and the dimension of the space. When the number of sets in the sum is large, the bound is independent of the number of sets summed, depending rather on N, the dimension of the space. Hence the size of the non-convexity in the sum becomes small as a proportion of the number of sets summed; the non-convexity per summand goes to zero as the number of summands becomes large. The Shapley–Folkman theorem can be viewed as a discrete counterpart to the Lyapunov theorem on non-atomic measures (Grodal 2002).

Keywords

Large economies Lyapunov th Non-convexity Shapley–Folkman th 

JEL Classifications

D5 
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Copyright information

© Macmillan Publishers Ltd. 2018

Authors and Affiliations

  • Ross M. Starr
    • 1
  1. 1.