A note on two notions of arbitrage
Since Hart's  and Werner's  seminal papers, several conditions have been proposed to show the existence of equilibrium in an asset exchange economy with short-selling. In this note, we discuss the relationship between two no-arbitrage conditions. The first condition is the assumption that the individually rational utility set U is compact, as considered by Dana, Le Van and Magnien . The second is inconsequential arbitrage, introduced by Page, Wooders and Monteiro . The main result of this comparison is to show that the inconsequential arbitrage condition is stronger than the assumption that U is compact
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- Grandmont, Jean-Michel, 1993.
"Temporary general equilibrium theory,"
Handbook of Mathematical Economics,in: K. J. Arrow & M.D. Intriligator (ed.), Handbook of Mathematical Economics, edition 4, volume 2, chapter 19, pages 879-922
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- Lars Tyge Nielsen, 1989. "Asset Market Equilibrium with Short-Selling," Review of Economic Studies, Oxford University Press, vol. 56(3), pages 467-473. Full references (including those not matched with items on IDEAS)
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