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Single and Attractive: Uniqueness and Stability of Economic Equilibria Under Monotonicity Assumptions

Author

Listed:
  • Patrizio Bifulco
  • Jochen Glück
  • Oliver Krebs
  • Bohdan Kukharskyy

Abstract

This paper characterizes equilibrium properties of a broad class of economic models that al-low multiple heterogeneous agents to interact in heterogeneous manners across several markets. Our key contribution is a new theorem providing sufficient conditions for uniqueness and stability of equilibria in this class of models. To illustrate the applicability of our theorem, we characterize the general equilibrium properties of two commonly used quantitative trade models. Specifically, our analysis provides a first proof of uniqueness and stability of the equilibrium in multi-country trade models featuring (i) multiple sectors, or (ii) heterogeneity across countries in terms of their labor cost shares. These examples also provide a practical toolkit for future research on how our theorem can be applied to establish uniqueness and stability of equilibria in a broad set of economic models.

Suggested Citation

  • Patrizio Bifulco & Jochen Glück & Oliver Krebs & Bohdan Kukharskyy, 2025. "Single and Attractive: Uniqueness and Stability of Economic Equilibria Under Monotonicity Assumptions," CESifo Working Paper Series 11623, CESifo.
    • Handle: RePEc:ces:ceswps:_11623
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    File URL: https://www.cesifo.org/DocDL/cesifo1_wp11623.pdf
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    More about this item

    Keywords

    uniqueness; stability; general equilibrium; quantitative trade; networks;
    All these keywords.

    JEL classification:

    • D50 - Microeconomics - - General Equilibrium and Disequilibrium - - - General
    • C62 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Existence and Stability Conditions of Equilibrium
    • F11 - International Economics - - Trade - - - Neoclassical Models of Trade
    • R13 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - General Equilibrium and Welfare Economic Analysis of Regional Economies

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