General equilibrium with producers and brokers existence and regularity

Jouini, Elyès; Kallal, Hedi

Jouini, Elyès; Kallal, Hedi (1993), General equilibrium with producers and brokers existence and regularity, Economics Letters, 41, 3, p. 257-263. http://dx.doi.org/10.1016/0165-1765(93)90150-B

Type

Article accepté pour publication ou publié

Date

1993

Journal name

Economics Letters

Volume

Number

Publisher

Elsevier

Pages

257-263

Abstract (EN)

In this paper we prove the existence of general equilibrium with transaction costs generalizing Hahn's (Review of Economic Studies, 1973, 40, 449-461) model by introducing producers and nonconvexities (in particular we allow for increasing returns in transaction sets). We also recover any exchange economy as a special case and this allows us to analyze the effects of small frictions on bid-ask prices, consumption vectors and utilities. We prove that, generically, the induced perturbations are of the same order as the frictions.

Subjects / Keywords

Equilibrium; Exchange and Production Economies; Transaction Costs

JEL

D51 - Exchange and Production Economies
C62 - Existence and Stability Conditions of Equilibrium
D58 - Computable and Other Applied General Equilibrium Models
D23 - Organizational Behavior; Transaction Costs; Property Rights