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Contracts and domination in incomplete markets

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Author Info
Marakulin Valery ()

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Abstract

A domination concept, based on the notion of an exchange contract, is proposed and studied in this paper. Doing so, the classical notion of domination via coalitions is transmitted onto systems (webs) of contracts and onto allocations, whose stability is investigated. This way, the proposed concept of a core for incomplete markets is described as a set of allocations realized by the webs of contracts that have a special kind of stability relative to the breaking of existing contracts and relative to the ability to sign new contracts. This concept converts into classical core when the market turns complete. Under perfect competition conditions, core allocations are equilibria. These properties prove that the studied core concept is valid.

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Publisher Info
Paper provided by EERC Research Network, Russia and CIS in its series EERC Working Paper Series with number 02-04e.

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Length: 86 pages
Date of creation: 24 Sep 2003
Date of revision:
Handle: RePEc:eer:wpalle:02-04e

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Related research
Keywords: Russia; incomplete markets; core; contract; contractual allocation; competitive equilibrium;

Find related papers by JEL classification:
C62 - Mathematical and Quantitative Methods - - Mathematical Methods and Programming - - - Existence and Stability Conditions of Equilibrium
D51 - Microeconomics - - General Equilibrium and Disequilibrium - - - Exchange and Production Economies

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  1. Marakulin Valery, 2006. "On convergence of contractual trajectories in pure exchange economies," EERC Working Paper Series 06-07e, EERC Research Network, Russia and CIS. [Downloadable!]
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This page was last updated on 2009-12-15.


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