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General Economic Equilibrium with Dispersed Preferences over Discrete Alternatives: An Existence Proof Using Optimisation

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  • W D Macmillan

    (School of Geography, University of Oxford, Mansfield Road, Oxford OX1 3TB, England)

Abstract

This paper is concerned with the foundations of urban spatial interaction modelling but is cast in a more general form. Its purpose is to establish a sound microeconomic basis for the construction of CGE (computable general equilibrium) models of cities. It is based on three premises: (1) before trying to compute equilibria, it is prudent to show that they exist; (2) careful consideration of the circumstances under which they exist is advantageous both technically and theoretically; (3) by constructing an existence proof which centres on a mathematical programming problem, it is possible to forge a direct connection between the programming-based spatial interaction modelling literature and general equilibrium theory.

Suggested Citation

  • W D Macmillan, 1995. "General Economic Equilibrium with Dispersed Preferences over Discrete Alternatives: An Existence Proof Using Optimisation," Environment and Planning A, , vol. 27(12), pages 2019-2033, December.
  • Handle: RePEc:sae:envira:v:27:y:1995:i:12:p:2019-2033
    DOI: 10.1068/a272019
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