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Introduction to Sunspots and Lotteries

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  • Prescott, Edward C.
  • Shell, Karl

Abstract

This introduces the symposium on sunspots and lotteries. Two stochastic general equilibrium concepts, Sunspot Equilibrium (SE) and Lottery Equilibrium (LE), are compared. It is shown that, for some general, pure-exchange economies which allow for consumption non-convexities or moral hazards, the set of LE allocations is equivalent to the set of SE allocations provided that the randomizing device can generate events of any probability.

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Bibliographic Info

Article provided by Elsevier in its journal Journal of Economic Theory.

Volume (Year): 107 (2002)
Issue (Month): 1 (November)
Pages: 1-10

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Handle: RePEc:eee:jetheo:v:107:y:2002:i:1:p:1-10

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Web page: http://www.elsevier.com/locate/inca/622869

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  19. Prescott, Edward Simpson & Townsend, Robert M., 2002. "Collective Organizations versus Relative Performance Contracts: Inequality, Risk Sharing, and Moral Hazard," Journal of Economic Theory, Elsevier, Elsevier, vol. 103(2), pages 282-310, April.
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Citations

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Cited by:
  1. Prescott, Edward C., 2004. "The Transformation of Macroeconomic Policy and Research," Nobel Prize in Economics documents, Nobel Prize Committee 2004-7, Nobel Prize Committee.
  2. Masahiko Aoki, 2006. "Mechanisms of Endogenous Institutional Change," Discussion Papers, Stanford Institute for Economic Policy Research 05-013, Stanford Institute for Economic Policy Research.
  3. Rocheteau, Guillaume & Rupert, Peter & Shell, Karl & Wright, Randall, 2008. "General equilibrium with nonconvexities and money," Journal of Economic Theory, Elsevier, Elsevier, vol. 142(1), pages 294-317, September.
  4. Kent Grote & Victor Matheson, 2011. "The Economics of Lotteries: An Annotated Bibliography," Working Papers, College of the Holy Cross, Department of Economics 1110, College of the Holy Cross, Department of Economics.

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