1992 Reports
Existence of a General Equilibrium with Price Uncertainty
The paper defines a concept of a general equilibrium in markets with uncertainty about prices, and proves the existence of such equilibrium under standard conditions on endowments and preferences. In the market equilibrium defined here the state space which represents price uncertainty is endogenous to the economy. Agents do not know the possible equilibrium prices a priori. Theorem 2 establishes the existence of equilibrium, consisting of a state space, the corresponding asset markets, and prices yielding a fully insured and Pareto efficient allocation which clears all markets.
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Files
- econ_9293_651.pdf application/pdf 1.51 MB Download File
More About This Work
- Academic Units
- Economics
- Publisher
- Department of Economics, Columbia University
- Series
- Department of Economics Discussion Papers, 651
- Published Here
- February 17, 2011
Notes
September 1992.