We study a financial market economy with a continuum of borrowers and pooling of borrowers’ promises. Under these conditions and in the absence of designing costs, utility-maximizing decisions of price-taking borrowers may lead to financial market incompleteness. Parametrizing equilibria...

We consider a pure exchange, general equilibrium model, with two periods and a finite number of states, commodities, numeraire assets, and households. Participation in the asset markets is restricted in a household specific manner, imposing upper bounds on the amounts of borrowing which can be...

We consider a model with real assets and restricted participation described by household-specific price-dependent short selling constraints. We show existence of equilibria for all elements in an explicitly characterized large subset of the set of economies. Copyright Springer-Verlag Italia 2014