IDEAS home Printed from https://ideas.repec.org/p/ags/uwarer/269332.html
   My bibliography  Save this paper

Inconsequential arbitrage

Author

Listed:
  • Page, Frank H., Jr.
  • Wooders, Myrna H.
  • Monteiro, Paulo K.

Abstract

We introduce the concept of inconsequential arbitrage and, in the context of a model allowing short-sales and half-lines in indifference surfaces, we prove that inconsequential arbitrage is sufficient for existence of equilibrium. With a slightly stronger condition of local nonsatiation than required for existence of equilibrium and with a mild uniformity condition on arbitrage opportunities, we show that the existence of a pareto-optimal allocation implies inconsequential arbitrage, implying that inconsequential arbitrage is necessary and sufficient for existence of an equilibrium.
(This abstract was borrowed from another version of this item.)

Suggested Citation

  • Page, Frank H., Jr. & Wooders, Myrna H. & Monteiro, Paulo K., 1999. "Inconsequential arbitrage," Economic Research Papers 269332, University of Warwick - Department of Economics.
    • Handle: RePEc:ags:uwarer:269332
    DOI: 10.22004/ag.econ.269332
    as

    Download full text from publisher

    File URL: https://ageconsearch.umn.edu/record/269332/files/twerp561.pdf
    Download Restriction: no
    File URL: https://ageconsearch.umn.edu/record/269332/files/twerp561.pdf?subformat=pdfa
    Download Restriction: no
    File URL: https://libkey.io/10.22004/ag.econ.269332?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    Other versions of this item:

    References listed on IDEAS

    as
    1. Page Jr., Frank H. & Wooders, Myrna Holtz, 1996. "The Partnered Core of an Economy and the Partnered Competitive Equilibrium," Economics Letters, Elsevier, vol. 52(2), pages 143-152, August.
    2. Frank H. Page Jr. & (**), Myrna H. Wooders & Paulo K. Monteiro, 1999. "Arbitrage and global cones: Another counterexample," Social Choice and Welfare, Springer;The Society for Social Choice and Welfare, vol. 16(2), pages 337-346.
    3. Gale, D. & Mas-Colell, A., 1975. "An equilibrium existence theorem for a general model without ordered preferences," Journal of Mathematical Economics, Elsevier, vol. 2(1), pages 9-15, March.
    4. Donald J. Brown & Jan Werner, 1995. "Arbitrage and Existence of Equilibrium in Infinite Asset Markets," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 62(1), pages 101-114.
    5. 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, Elsevier.
    6. Dana, Rose-Anne & Le Van, Cuong & Magnien, Francois, 1999. "On the Different Notions of Arbitrage and Existence of Equilibrium," Journal of Economic Theory, Elsevier, vol. 87(1), pages 169-193, July.
    7. Page, F.H.Jr. & Wooders, M.H., 1994. "Arbitrage in Markets with Unbounded Short Sales: Necessary and Sufficient Conditions for Nonemptiness of the Core and Existence of Equilibrium," UFAE and IAE Working Papers 271.94, Unitat de Fonaments de l'Anàlisi Econòmica (UAB) and Institut d'Anàlisi Econòmica (CSIC).
    8. Page Jr., Frank H. & Wooders, Myrna Holtz, 1996. "A necessary and sufficient condition for the compactness of individually rational and feasible outcomes and the existence of an equilibrium," Economics Letters, Elsevier, vol. 52(2), pages 153-162, August.
    9. Chichilnisky, Graciela, 1997. "A topological invariant for competitive markets," Journal of Mathematical Economics, Elsevier, vol. 28(4), pages 445-469, November.
    10. Bergstrom, Theodore C., 1976. "How to discard `free disposability' - at no cost," Journal of Mathematical Economics, Elsevier, vol. 3(2), pages 131-134, July.
    11. PageJr., Frank H. & Wooders, Myrna H. & Monteiro, Paulo K., 2000. "Inconsequential arbitrage," Journal of Mathematical Economics, Elsevier, vol. 34(4), pages 439-469, December.
    12. Werner, Jan, 1987. "Arbitrage and the Existence of Competitive Equilibrium," Econometrica, Econometric Society, vol. 55(6), pages 1403-1418, November.
    13. Hart, Oliver D., 1974. "On the existence of equilibrium in a securities model," Journal of Economic Theory, Elsevier, vol. 9(3), pages 293-311, November.
    14. Green, Jerry R, 1973. "Temporary General Equilibrium in a Sequential Trading Model with Spot and Futures Transactions," Econometrica, Econometric Society, vol. 41(6), pages 1103-1123, November.
    15. Reny, Philip J. & Holtz Wooders, Myrna, 1996. "The Partnered Core of a Game without Side Payments," Journal of Economic Theory, Elsevier, vol. 70(2), pages 298-311, August.
    16. Hammond, Peter J., 1983. "Overlapping expectations and Hart's conditions for equilibrium in a securities model," Journal of Economic Theory, Elsevier, vol. 31(1), pages 170-175, October.
    17. Lars Tyge Nielsen, 1989. "Asset Market Equilibrium with Short-Selling," The Review of Economic Studies, Review of Economic Studies Ltd, vol. 56(3), pages 467-473.
    18. Page, Frank Jr., 1987. "On equilibrium in Hart's securities exchange model," Journal of Economic Theory, Elsevier, vol. 41(2), pages 392-404, April.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Paul Oslington, 2012. "General Equilibrium: Theory and Evidence," The Economic Record, The Economic Society of Australia, vol. 88(282), pages 446-448, September.
    2. W D A Bryant, 2009. "General Equilibrium:Theory and Evidence," World Scientific Books, World Scientific Publishing Co. Pte. Ltd., number 6875, August.
    3. Allouch, Nizar & Le Van, Cuong & Page, Frank Jr., 2006. "Arbitrage and equilibrium in unbounded exchange economies with satiation," Journal of Mathematical Economics, Elsevier, vol. 42(6), pages 661-674, September.
    4. Allouch, Nizar & Van, Cuong Le & Page Jr. Frank H., 2002. "Arbitrage, Equilibrium And Nonsatiation," The Warwick Economics Research Paper Series (TWERPS) 637, University of Warwick, Department of Economics.
    5. Ha-Huy, Thai & Le Van, Cuong, 2017. "Existence of equilibrium on asset markets with a countably infinite number of states," Journal of Mathematical Economics, Elsevier, vol. 73(C), pages 44-53.
    6. Le Van, Cuong & Truong Xuan, Duc Ha, 2001. "Asset market equilibrium in Lp spaces with separable utilities," Journal of Mathematical Economics, Elsevier, vol. 36(3), pages 241-254, December.
    7. Cuong Van & Frank Page & Myrna Wooders, 2007. "Risky arbitrage, asset prices, and externalities," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 33(3), pages 475-491, December.
    8. Ha-Huy, Thai & Le Van, Cuong & Tran-Viet, Cuong, 2018. "Arbitrage and equilibrium in economies with short-selling and ambiguity," Journal of Mathematical Economics, Elsevier, vol. 76(C), pages 95-100.
    9. Dana, R.A. & Le Van, C., 2010. "Overlapping risk adjusted sets of priors and the existence of efficient allocations and equilibria with short-selling," Journal of Economic Theory, Elsevier, vol. 145(6), pages 2186-2202, November.
    10. Allouch, Nizar & Le Van, Cuong & Page, Frank Jr., 2002. "The geometry of arbitrage and the existence of competitive equilibrium," Journal of Mathematical Economics, Elsevier, vol. 38(4), pages 373-391, December.
    11. Dana, Rose-Anne & Le Van, Cuong & Magnien, Francois, 1999. "On the Different Notions of Arbitrage and Existence of Equilibrium," Journal of Economic Theory, Elsevier, vol. 87(1), pages 169-193, July.
    12. Danilov, Vladimir & Koshovoy, Gleb & Page, Frank & Wooders, Myrna, 2011. "Existence of equilibrium with unbounded short sales: A new approach," MPRA Paper 37778, University Library of Munich, Germany, revised Mar 2012.
    13. Thai Ha-Huy & Cuong Le Van & Myrna Wooders, 2024. "Existence of Equilibrium in Finite Dimensional Asset Markets," Working Papers hal-04131008, HAL.
    14. Thai Ha-Huy & Cuong Le Van & Frank Page & Myrna Wooders, 2017. "No-arbitrage and Equilibrium in Finite Dimension: A General Result," Université Paris1 Panthéon-Sorbonne (Post-Print and Working Papers) halshs-01529663, HAL.
    15. Allouch, Nizar & Le Van, Cuong & Page, Frank H., Jr., 2002. "Arbitrage, Equilibrium, and Nonsatiation," Economic Research Papers 269411, University of Warwick - Department of Economics.
    16. Le Van, Cuong & Page, Frank H., Jr. & Wooders, Myrna H., 2001. "Arbitrage and Equilibrium in Economies with Externalities," Economic Research Papers 269359, University of Warwick - Department of Economics.
    17. Wassim Daher & V. Martins-da-Rocha & Yiannis Vailakis, 2007. "Asset market equilibrium with short-selling and differential information," Economic Theory, Springer;Society for the Advancement of Economic Theory (SAET), vol. 32(3), pages 425-446, September.
    18. Monteiro, Paulo K. & Page, Frank Jr. & Wooders, Myrna Holtz, 1997. "Arbitrage, equilibrium, and gains from trade: A counterexample," Journal of Mathematical Economics, Elsevier, vol. 28(4), pages 481-501, November.
    19. Martins-da-Rocha, V. Filipe & Monteiro, Paulo K., 2009. "Unbounded exchange economies with satiation: How far can we go?," Journal of Mathematical Economics, Elsevier, vol. 45(7-8), pages 465-478, July.
    20. Ha-Huy, Thai & Le Van, Cuong & Nguyen, Manh-Hung, 2016. "Arbitrage and asset market equilibrium in infinite dimensional economies with short-selling and risk-averse expected utilities," Mathematical Social Sciences, Elsevier, vol. 79(C), pages 30-39.

    More about this item

    Keywords

    Agricultural and Food Policy; Research Methods/ Statistical Methods;

    JEL classification:

    • J51 - Labor and Demographic Economics - - Labor-Management Relations, Trade Unions, and Collective Bargaining - - - Trade Unions: Objectives, Structure, and Effects
    • J52 - Labor and Demographic Economics - - Labor-Management Relations, Trade Unions, and Collective Bargaining - - - Dispute Resolution: Strikes, Arbitration, and Mediation

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ags:uwarer:269332. See general information about how to correct material in RePEc.

    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 CitEc recognized a bibliographic reference but did not link an item in RePEc 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 RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: AgEcon Search (email available below). General contact details of provider: https://warwick.ac.uk/fac/soc/economics/research/workingpapers/ .

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

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.