IDEAS home Printed from https://ideas.repec.org/a/eee/jetheo/v144y2009i4p1832-1843.html
   My bibliography  Save this article

Excess demand functions when new assets are introduced

Author

Listed:
  • Momi, Takeshi

Abstract

We demonstrate that information on the aggregate excess demand function of an incomplete real asset market economy is not helpful toward predicting the equilibrium of a new economy to which unredundant assets are added. An innovation of assets can completely change the aggregate excess demand functions.

Suggested Citation

  • Momi, Takeshi, 2009. "Excess demand functions when new assets are introduced," Journal of Economic Theory, Elsevier, vol. 144(4), pages 1832-1843, July.
    • Handle: RePEc:eee:jetheo:v:144:y:2009:i:4:p:1832-1843
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0022-0531(09)00048-9
    Download Restriction: Full text for ScienceDirect subscribers only
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Thorsten Hens & Piero Gottardi, 1999. "Disaggregation of excess demand and comparative statics with incomplete markets and nominal assets," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 13(2), pages 287-308.
    2. Gottardi, Piero & Mas-Colell, Andreu, 2000. "A note on the decomposition (at a point) of aggregate excess demand on the Grassmannian1," Journal of Mathematical Economics, Elsevier, vol. 33(4), pages 463-473, May.
    3. Momi, Takeshi, 2003. "Excess demand functions with incomplete markets--a global result," Journal of Economic Theory, Elsevier, vol. 111(2), pages 240-250, August.
    4. Bottazzi, Jean-Marc & Hens, Thorsten, 1996. "Excess Demand Functions and Incomplete Markets," Journal of Economic Theory, Elsevier, vol. 68(1), pages 49-63, January.
    5. Elul Ronel, 1995. "Welfare Effects of Financial Innovation in Incomplete Markets Economies with Several Consumption Goods," Journal of Economic Theory, Elsevier, vol. 65(1), pages 43-78, February.
    6. Debreu, Gerard, 1974. "Excess demand functions," Journal of Mathematical Economics, Elsevier, vol. 1(1), pages 15-21, March.
    7. Hart, Oliver D., 1975. "On the optimality of equilibrium when the market structure is incomplete," Journal of Economic Theory, Elsevier, vol. 11(3), pages 418-443, December.
    8. David Cass & Alessandro Citanna, 1998. "Pareto improving financial innovation in incomplete markets," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 11(3), pages 467-494.
    9. Chiappori, Pierre-Andre & Ekeland, Ivar, 1999. "Disaggregation of excess demand functions in incomplete markets1," Journal of Mathematical Economics, Elsevier, vol. 31(1), pages 111-129, February.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Hara, Chiaki, 2011. "Pareto improvement and agenda control of sequential financial innovations," Journal of Mathematical Economics, Elsevier, vol. 47(3), pages 336-345.
    2. Momi, Takeshi, 2010. "Excess demand function around critical prices in incomplete markets," Journal of Mathematical Economics, Elsevier, vol. 46(3), pages 293-302, May.
    3. Chiaki Hara, 2010. "Pareto Improvement and Agenda Control of Sequential Financial Innovations," KIER Working Papers 748, Kyoto University, Institute of Economic Research.
    4. Kubler, F. & Chiappori, P. -A. & Ekeland, I. & Polemarchakis, H. M., 2002. "The Identification of Preferences from Equilibrium Prices under Uncertainty," Journal of Economic Theory, Elsevier, vol. 102(2), pages 403-420, February.
    5. Hens, Thorsten, 2001. "An extension of Mantel (1976) to incomplete markets," Journal of Mathematical Economics, Elsevier, vol. 36(2), pages 141-149, November.
    6. Momi, Takeshi, 2003. "Excess demand functions with incomplete markets--a global result," Journal of Economic Theory, Elsevier, vol. 111(2), pages 240-250, August.
    7. Thorsten Hens, "undated". "An Extension of Mantel (1976) to Incomplete Markets," IEW - Working Papers 071, Institute for Empirical Research in Economics - University of Zurich.
    8. Chiappori, Pierre-Andre & Ekeland, Ivar, 2004. "Applying exterior differential calculus to economics: a presentation and some new results," Japan and the World Economy, Elsevier, vol. 16(3), pages 363-385, August.
    9. Sergio Turner, 2004. "Pareto Improving Taxation in Incomplete Markets," Econometric Society 2004 Latin American Meetings 310, Econometric Society.
    10. Brock, W.A. & Hommes, C.H. & Wagener, F.O.O., 2009. "More hedging instruments may destabilize markets," Journal of Economic Dynamics and Control, Elsevier, vol. 33(11), pages 1912-1928, November.
    11. Sergio Turner & Norovsambuu Tumennasan, 2006. "Pareto Improving Monetary Policy in Incomplete Markets," Working Papers 2006-04, Brown University, Department of Economics.
    12. Piero Gottardi & Andreu Mas-Colell, 1999. "A Note on the Decomposition (at a Point) of Aggregate Excess Demand on the Grassmannian," Working Papers 99-11, Brown University, Department of Economics.
    13. Sergio Turner, 2004. "Pareto Improving Taxation in Incomplete Markets," Econometric Society 2004 North American Summer Meetings 614, Econometric Society.
    14. JÊrÆme B. Detemple & Piero Gottardi, 1998. "Aggregation, efficiency and mutual fund separation in incomplete markets," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 11(2), pages 443-455.
    15. Gottardi, Piero & Mas-Colell, Andreu, 2000. "A note on the decomposition (at a point) of aggregate excess demand on the Grassmannian1," Journal of Mathematical Economics, Elsevier, vol. 33(4), pages 463-473, May.
    16. Sabarwal Tarun, 2007. "Value Maximization as an Ex-Post Consistent Firm Objective When Markets are Incomplete," The B.E. Journal of Theoretical Economics, De Gruyter, vol. 7(1), pages 1-21, January.
    17. Willems, Bert & Morbee, Joris, 2010. "Market completeness: How options affect hedging and investments in the electricity sector," Energy Economics, Elsevier, vol. 32(4), pages 786-795, July.
    18. Sergio Turner, 2006. "Theory of Demand in Incomplete Markets," Working Papers 2006-07, Brown University, Department of Economics.
    19. Yves Balasko & Enrique Kawamura, 2010. "Pareto-Improving Defaul," Working Papers 102, Universidad de San Andres, Departamento de Economia, revised May 2010.
    20. Sy-Ming Guu & Kenneth L. Judd, 2001. "Asymptotic methods for asset market equilibrium analysis," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 18(1), pages 127-157.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:jetheo:v:144:y:2009:i:4:p:1832-1843. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/locate/inca/622869 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.