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Existence of GE: Are the Cases of Non Existence a Cause of Serious Worry?

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Author Info
Elvio Accinelli () (Facultad de Ingeniería, IMERL, Universidad de la República)

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Abstract

In this work, we attempt to characterize the main theoretical difficulties to prove the existence of competitive equilibrium in infinite dimensional models. We shall show cases in which it is not possible to prove the existence of equilibrium and some others in which, however the existence of equilibrium can be proved, the equilibrium prices seem not to have natural economic interpretation. Nevertheless in pure exchange economies, most of these difficulties may be avoided by mild restrictions on the model. In productive economies new specifics problem appear, for instance non convexity of the production sets or non boundedness of the feasible allocation sets. To prove the existence and the efficiency of the equilibrium in productive economies we need some strong hypothesis about the technological possibilities of each firm.

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Paper provided by Department of Economics - dECON in its series Documentos de Trabajo (working papers) with number 0999.

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Length: 25 pages
Date of creation: Jul 1999
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Handle: RePEc:ude:wpaper:0999

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  1. Yannelis, Nicholas C. & Zame, William R., 1986. "Equilibria in Banach lattices without ordered preferences," Journal of Mathematical Economics, Elsevier, vol. 15(2), pages 85-110, April. [Downloadable!] (restricted)
  2. Richard, Scott F. & Zame, William R., 1986. "Proper preferences and quasi-concave utility functions," Journal of Mathematical Economics, Elsevier, vol. 15(3), pages 231-247, June. [Downloadable!] (restricted)
  3. Monteiro, Paulo Klinger, 1994. "Inada's condition implies equilibrium existence is rare," Economics Letters, Elsevier, vol. 44(1-2), pages 99-102. [Downloadable!] (restricted)
  4. Elvio Accinelli, 1996. "Some remarks about uniquenes of equilibrium for infinite dimensional economies," Estudios Económicos, El Colegio de México, Centro de Estudios Económicos, vol. 11(1), pages 3-31.
  5. Monteiro, Paulo Klinger, 1987. "Some results on the existence of utility functions on path connected spaces," Journal of Mathematical Economics, Elsevier, vol. 16(2), pages 147-156, April. [Downloadable!] (restricted)
  6. Araujo A. & Monteiro P. K., 1994. "The General Existence of Extended Price Equilibria with Infinitely Many Commodities," Journal of Economic Theory, Elsevier, vol. 63(2), pages 408-416, August. [Downloadable!] (restricted)
  7. Araujo, A. & Monteiro, P. K., 1991. "Generic non-existence of equilibria in finance models," Journal of Mathematical Economics, Elsevier, vol. 20(5), pages 489-499. [Downloadable!] (restricted)
  8. Elvio Accinelli, 1999. "Existence and uniqueness of the Competitive Equilibrium for Infinite Dimensional Economies," Documentos de Trabajo (working papers) 0399, Department of Economics - dECON. [Downloadable!]
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