SFB 303 Discussion Paper No. A - 261
Author: Polemarchakis, H. M., and P. Siconolfi
Title: The Existence of Competitive Equilibria when the Asset Market is
Incomplete: A Short Proof and Further Results
Abstract: When the asset market is incomplete, and assets are traded at an initial
contracting period, competitive equilibria may fail to exist. This may occur
in a robust economy with asset payoffs denominated in a numeraire commodity.
Restrictions on the asset structure guarantee the existence of competitive
equilibria; consumption during the contracting period can be interpreted as
such a restriction. When asset payoffs are denominated in multiple commodities,
competitive equilibria exist generically.
Creation-Date: August 1989
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