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General Equilibrium with Differentiated Commodities: The Linear Activity Model without Joint Production

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  • Podczeck, Konrad

Abstract

In this paper the existence of a general equilibrium with differentiated commodities is proved for the classical case of a production set with constant returns, spanned by elementary activities without joint production, and with a finite set of primary factors. This framework allows to proceed without strong assumptions concerning substitution possibilities, which are typical in general equilibrium theory with differentiated commodities, but which at least with respect to production are not adequate to the problem. Moreover, in our model general consumption sets are allowed. Thus true intermediate products are not excluded. Furthermore the possibility of survival without trade is not assumed.

Suggested Citation

  • Podczeck, Konrad, 1992. "General Equilibrium with Differentiated Commodities: The Linear Activity Model without Joint Production," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 2(2), pages 247-263, April.
    • Handle: RePEc:spr:joecth:v:2:y:1992:i:2:p:247-63
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    Cited by:

    1. Robert Plant & Manuel S. Santos & Tarek Sayed, 2017. "Computerization, Composition of Employment, and Structure of Wages," Working Papers 2017-09, University of Miami, Department of Economics.

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