IDEAS home Printed from https://ideas.repec.org/
MyIDEAS: Log in (now much improved!) to save this paper

Behavioral Heterogeneity in Large Economies

Author Info

Listed author(s):
  • Gael Giraud
  • Isabelle Maret

Abstract

Grandmont\'s ([14]) notion of behavioral heterogeneity is reformulated in a non parametric set-up such that the space of budget share functions admits a ``uniform\'\' probability distribution. If the population is distributed according to this measure, the aggregate budget share function is constant with respect to changes in prices and income. This exact insensitivity of the market budget share function is known to imply uniqueness and global stability of any competitive equilibrium. Here, it is not explained by any insensitivity property at the micro-economic level, but rather by a perfect \'balancing effect\'. Eventually, it is proved that the insensitivity property holds approximately for a finite population sufficiently close to, but distinct from, the perfectly heterogenous one.

Download Info

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.

File URL: http://www.beta-umr7522.fr/productions/publications/2001/2001-08.pdf
Download Restriction: no

Paper provided by Bureau d'Economie Théorique et Appliquée, UDS, Strasbourg in its series Working Papers of BETA with number 2001-08.

as
in new window

Length:
Date of creation: 2001
Handle: RePEc:ulp:sbbeta:2001-08
Contact details of provider: Postal:
PEGE. 61, Aven. de la Forêt-Noire 67000 Strasbourg

Phone: +33 3 68 85 20 69
Fax: +33 3 68 85 20 70
Web page: http://www.beta-umr7522.fr/
Email:


More information through EDIRC

Keywords: Aggregation of demand; behavioral heterogeneity; large economy; Law of Demand; Insensitivity of market budget shares.;

Other versions of this item:

Find related papers by JEL classification:
  • D11 - Microeconomics - - Household Behavior - - - Consumer Economics: Theory
  • D12 - Microeconomics - - Household Behavior - - - Consumer Economics: Empirical Analysis
  • D30 - Microeconomics - - Distribution - - - General
  • D41 - Microeconomics - - Market Structure, Pricing, and Design - - - Perfect Competition
  • D50 - Microeconomics - - General Equilibrium and Disequilibrium - - - General
  • E1 - Macroeconomics and Monetary Economics - - General Aggregative Models

This paper has been announced in the following NEP Reports:

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:

as
in new window


  1. Bottazzi, Jean-Marc & Hens, Thorsten, 1996. "Excess Demand Functions and Incomplete Markets," Journal of Economic Theory, Elsevier, vol. 68(1), pages 49-63, January.
  2. P. A. Chiappori & I. Ekeland, 1999. "Aggregation and Market Demand: An Exterior Differential Calculus Viewpoint," Econometrica, Econometric Society, vol. 67(6), pages 1435-1458, November.
  3. Kubler, F. & Chiappori, P. -A. & Ekeland, I. & Polemarchakis, H. M., 2002. "The Identification of Preferences from Equilibrium Prices under Uncertainty," Journal of Economic Theory, Elsevier, vol. 102(2), pages 403-420, February.
  4. Kirman, Alan, 1989. "The Intrinsic Limits of Modern Economic Theory: The Emperor Has No Clothes," Economic Journal, Royal Economic Society, vol. 99(395), pages 126-139, Supplemen.
  5. Mertens, J.-F., 1988. "Stable equilibria - a reformulation," CORE Discussion Papers 1988038, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
  6. Hildenbrand, Werner, 1983. "On the "Law of Demand."," Econometrica, Econometric Society, vol. 51(4), pages 997-1019, July.
  7. Momi, Takeshi, 2003. "Excess demand functions with incomplete markets--a global result," Journal of Economic Theory, Elsevier, vol. 111(2), pages 240-250, August.
  8. Kneip, Alois, 1999. "Behavioral heterogeneity and structural properties of aggregate demand," Journal of Mathematical Economics, Elsevier, vol. 31(1), pages 49-79, February.
  9. John K.-H. Quah, 1997. "The Law of Demand when Income Is Price Dependent," Econometrica, Econometric Society, vol. 65(6), pages 1421-1442, November.
  10. Dierker, Egbert & Dierker, Hildegard & Trockel, Walter, 1984. "Price-dispersed preferences and C1 mean demand," Journal of Mathematical Economics, Elsevier, vol. 13(1), pages 11-42, April.
  11. CALVET, Laurent & GRANDMONT, Jean-Michel & LEMAIRE, Isabelle, 1998. "Heterogeneous probabilities in complete asset markets," CORE Discussion Papers 1998019, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
  12. Hildenbrand, K., 1998. "On J.M. Grandmont's Modelling of Behavioral Heterogeneity," Discussion Paper Serie A 580, University of Bonn, Germany.
  13. Marhuenda, F, 1995. "Distribution of Income and Aggregation of Demand," Econometrica, Econometric Society, vol. 63(3), pages 647-666, May.
  14. de Villemur, E.B., 1998. "Heterogeneity and Stability: Variations on Scarf's Processes," Economics Working Papers eco98/38, European University Institute.
  15. Mas-Colell, Andreu & Neuefeind, Wilhelm, 1977. "Some Generic Properties of Aggregate Excess Demand and an Application," Econometrica, Econometric Society, vol. 45(3), pages 591-599, April.
Full references (including those not matched with items on IDEAS)

Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.

as
in new window


Cited by:

  1. Gael Giraud & John Quah, 2002. "Heterotic Models of Aggregate Demand," Economics Papers 2002-W18, Economics Group, Nuffield College, University of Oxford.
  2. Giraud Gael & Quah John K.-H., 2003. "Homothetic or Cobb-Douglas Behavior Through Aggregation," The B.E. Journal of Theoretical Economics, De Gruyter, vol. 3(1), pages 1-23, December.
  3. Werner Hildenbrand & Alois Kneip, 2005. "On behavioral heterogeneity," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 25(1), pages 155-169, 01.

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

Access and download statistics

When requesting a correction, please mention this item's handle: RePEc:ulp:sbbeta:2001-08. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: ()

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.

This information is provided to you by IDEAS at the Research Division of the Federal Reserve Bank of St. Louis using RePEc data.