Within a general equilibrium framework à la (Long and Plosser, 1983), we investigate the dynamics emerging from the interactions of households and firms that are adaptive price setters and financially constrained. Adaptive price-setting behavior induces micro-founded out-of-equilibrium dynamics...

This paper studies the welfare improvement properties of a market for pollution permits in an economy with a single type of externality. We show that, thanks to the opening of such a market, the Pareto optima can be decentralized as marginal pricing equilibria. However, the set of equilibria is...

This paper explores to what extent moving towards the 30% GHG emission reductions by 2020 with respect to 1990 in the EU can be considered a <italic>transformative target</italic>. To do so, we first define the concept of transformative targets from a complex systems perspective and show a novel approach and...

We present a mathematical model for the analysis of the bargaining games based on private prices used by Gintis to simulate the dynamics of prices in exchange economies in Gintis (2007). We then characterize, in the Scarf economy, a class of dynamics for which the Walrasian equilibrium is the...

We prove that the degree of the equilibrium correspondence of an economy with increasing returns and external effects is equal to (-1)L-1 where L is the dimension of the space of goods. This allows us to infer existence, finiteness and uniqueness results.