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Endogenous Transaction Costs

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  • Martins-da-Rocha, Victor Filipe
  • Vailakis, Yiannis

Abstract

The paper proposes an alternative general equilibrium formulation of financial asset economies with transactions costs. Transaction costs emerge endogenously at equilibrium and reflect agents decisions of intermediating financial activities at the expense of providing labor services. An equilibrium is shown to exist in the case of real asset structures.

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Paper provided by FGV/EPGE Escola Brasileira de Economia e Finanças, Getulio Vargas Foundation (Brazil) in its series Economics Working Papers (Ensaios Economicos da EPGE) with number 680.

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Date of creation: 28 Oct 2008
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Handle: RePEc:fgv:epgewp:680

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Cited by:
  1. Charles Nolan & Alex Trew, 2011. "Transaction Costs and Institutions," CDMA Working Paper Series, Centre for Dynamic Macroeconomic Analysis 201103, Centre for Dynamic Macroeconomic Analysis.
  2. Olaf Jonkeren & Erhan Demirel & Jos van Ommeren & Piet Rietveld, 2008. "Endogenous Transport Prices and Trade Imbalances," Tinbergen Institute Discussion Papers 08-088/3, Tinbergen Institute.
  3. S. Gruber & L. Marattin, 2009. "Taxation, Infrastructure, and Endogenous Trade Costs in New Economic Geography," Working Papers 668, Dipartimento Scienze Economiche, Universita' di Bologna.
  4. Stephen Redding, 2009. "Economic Geography: A Review of the Theoretical and Empirical Literature," CEP Discussion Papers dp0904, Centre for Economic Performance, LSE.
  5. V. Martins-da-Rocha & Yiannis Vailakis, 2010. "Financial markets with endogenous transaction costs," Economic Theory, Springer, Springer, vol. 45(1), pages 65-97, October.

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