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Nash-Walras equilibria of a large economy

Author

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  • MINELLI, Enrico

    (Department of Economics, Universita di Brescia)

  • POLEMARCHAKIS, Heracles

    (Center for Operations Research and Econometrics (CORE), Université catholique de Louvain (UCL), Louvain la Neuve, Belgium)

Abstract

Individuals exchange contracts for the deliveryof commodities in competitive markets and, simultaneously, act strategically; actions affect utilities across individuals directlyor through the payoffs of contracts. This encompasses economies with asymmetric information. Nash-Walras equilibria exist for large economies, even if utilityfunctions are not quasi - concave and choice sets are not convex, which is the case in standard settings; the separation of the purchase from the sale of contracts and the pooling of the deliveries on contracts guarantee that the markets for commodities clear.

Suggested Citation

  • MINELLI, Enrico & POLEMARCHAKIS, Heracles, 1999. "Nash-Walras equilibria of a large economy," LIDAM Discussion Papers CORE 1999043, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
    • Handle: RePEc:cor:louvco:1999043
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    File URL: https://sites.uclouvain.be/core/publications/coredp/coredp1999.html
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    References listed on IDEAS

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    1. Hart, Sergiu & Hildenbrand, Werner & Kohlberg, Elon, 1974. "On equilibrium allocations as distributions on the commodity space," Journal of Mathematical Economics, Elsevier, vol. 1(2), pages 159-166, August.
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    4. Bisin, A. & Geanakoplos, J.D. & Gottardi, P. & Minelli, E. & Polemarchakis, H., 2011. "Markets and contracts," Journal of Mathematical Economics, Elsevier, vol. 47(3), pages 279-288.
    5. Prescott, Edward C & Townsend, Robert M, 1984. "General Competitive Analysis in an Economy with Private Information," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 25(1), pages 1-20, February.
    6. Pradeep Dubey & John Geanakoplos & Martin Shubik, 1988. "Default and Efficiency in a General Equilibrium Model with Incomplete Markets," Cowles Foundation Discussion Papers 879R, Cowles Foundation for Research in Economics, Yale University, revised Feb 1989.
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    Cited by:

    1. Correia-da-Silva, João, 2012. "General equilibrium in markets for lemons," Journal of Mathematical Economics, Elsevier, vol. 48(3), pages 187-195.
    2. Joao Correia-da-Silva, 2009. "Uncertain delivery in markets for lemons," Levine's Working Paper Archive 814577000000000121, David K. Levine.
    3. CITANNA, Alessandro, 2000. "Proportional transaction costs on asset trades : a note on existence by homotopy methods," HEC Research Papers Series 717, HEC Paris.
    4. Joao Correia-da-Silva & Carlos Herves-Beloso, 2008. "General equilibrium with private state verification," Levine's Working Paper Archive 814577000000000024, David K. Levine.
    5. CITANNA, Alessandro, 2000. "Moral hazard and linear contracts : Economies with idiosyncratic risks," HEC Research Papers Series 699, HEC Paris.

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    More about this item

    Keywords

    Nash; Walras; equilibrium; asymmetric information;
    All these keywords.

    JEL classification:

    • D50 - Microeconomics - - General Equilibrium and Disequilibrium - - - General
    • D52 - Microeconomics - - General Equilibrium and Disequilibrium - - - Incomplete Markets
    • D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design

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