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On the existence of price equilibrium in economies with excess demand functions

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  • Guoqiang Tian

    () (Texas A&M University)

Abstract

Abstract This paper provides a price equilibrium existence theorem in economies where commodities may be indivisible and excess demand functions may not be continuous. We introduce a weak notion of continuity, called recursive transfer lower semi-continuity, which, together with Walras’ law, guarantees the existence of price equilibrium in economies with excess demand functions. The condition is also necessary, and thus our results generalize all the existing results on the existence of price equilibrium in economies where excess demand is a function.

Suggested Citation

  • Guoqiang Tian, 2016. "On the existence of price equilibrium in economies with excess demand functions," Economic Theory Bulletin, Springer;Society for the Advancement of Economic Theory (SAET), vol. 4(1), pages 5-16, April.
  • Handle: RePEc:spr:etbull:v:4:y:2016:i:1:d:10.1007_s40505-015-0091-7
    DOI: 10.1007/s40505-015-0091-7
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    References listed on IDEAS

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    More about this item

    Keywords

    Price equilibrium; Recursive transfer lower semi-continuity; Discontinuity; Excess demand function;

    JEL classification:

    • C62 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Existence and Stability Conditions of Equilibrium
    • C72 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory - - - Noncooperative Games
    • D44 - Microeconomics - - Market Structure, Pricing, and Design - - - Auctions
    • D61 - Microeconomics - - Welfare Economics - - - Allocative Efficiency; Cost-Benefit Analysis
    • D82 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Asymmetric and Private Information; Mechanism Design

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