If complete markets for intertemporal and state contingent consumption exist then outcomes7are always pareto-optimal Is this statement correct

Yes, the statement is correct. If complete markets for intertemporal and state-contingent consumption exist, then outcomes are always Pareto-optimal.

Complete markets refer to a situation where there are markets for all possible future states of the world and all possible intertemporal consumption plans. State-contingent consumption refers to consumption plans that are contingent upon specific future states of the world.

In such a scenario, individuals can trade assets and contracts to ensure that they are protected against all possible future states of the world. This means that each individual can achieve their desired consumption plan regardless of the future outcome.

Since individuals can achieve their desired consumption plans, and there are no possible improvements that can be made without making someone worse off, the outcome is Pareto-optimal. Pareto-optimality refers to a situation where no individual can be made better off without making someone else worse off