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Endogenous Information: The Role of Sequential Trade and Financial Participation

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  • Sebastián Cea-Echenique
  • Carlos Hervés-Beloso
  • Juan Pablo Torres-Martínez

Abstract

We develop a general equilibrium model with differential information and incomplete financial participation. Agents endogenously update information from commodity prices and financial contracts. Without require financial survival assumptions, we prove equilibrium existence in a model where the heterogeneity of preferences across states of nature may depends on available information.

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Bibliographic Info

Paper provided by University of Chile, Department of Economics in its series Working Papers with number wp361.

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Length: 18 pages
Date of creation: Sep 2012
Date of revision:
Handle: RePEc:udc:wpaper:wp361

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Web page: http://www.econ.uchile.cl/
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  2. Abdelkrim Seghir & Juan Pablo Torres-Martínez, 2010. "On equilibrium existence with endogenous restricted financial participation," Working Papers wp316, University of Chile, Department of Economics.
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  8. Cass, David & Siconolfi, Paolo & Villanacci, Antonio, 2001. "Generic regularity of competitive equilibria with restricted participation," Journal of Mathematical Economics, Elsevier, vol. 36(1), pages 61-76, September.
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  18. Carosi, Laura & Gori, Michele & Villanacci, Antonio, 2009. "Endogenous restricted participation in general financial equilibrium," Journal of Mathematical Economics, Elsevier, vol. 45(12), pages 787-806, December.
  19. Roy Radner, 1997. "Rational Expectations Equilibrium: Generic Existence and the Information Revealed by Prices," Levine's Working Paper Archive 1594, David K. Levine.
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  22. Wayne Shafer & Hugo Sonnenschein, 1974. "Equilibrium in Abstract Economies Without Ordered Preferences," Discussion Papers 94, Northwestern University, Center for Mathematical Studies in Economics and Management Science.
  23. Greenberg, Joseph & Shitovitz, Benyamin & Wieczorek, Andrzej, 1979. "Existence of equilibria in atomless production economies with price dependent preferences," Journal of Mathematical Economics, Elsevier, vol. 6(1), pages 31-41, March.
  24. Radner, Roy, 1972. "Existence of Equilibrium of Plans, Prices, and Price Expectations in a Sequence of Markets," Econometrica, Econometric Society, vol. 40(2), pages 289-303, March.
  25. John Geanakoplos, 1997. "An Introduction to General Equilibrium with Incomplete Asset Markets," Levine's Working Paper Archive 1115, David K. Levine.
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