Showing 1 - 10 of 43
There are many situations in which a customer’s proclivity to buy the product of any firm depends not only on the classical attributes of the product such as its price and quality, but also on who else is buying the same product. Under quite general circumstances, it turns out that...
Persistent link: https://www.econbiz.de/10010547942
We derive the existence of a Walras equilibrium directly from Nash's theorem on noncooperative games. No price player is involved, nor are generalized games. Instead we use a variant of the Shapley-Shubik trading-post game.
Persistent link: https://www.econbiz.de/10004990746
We derive the existence of a Walras equilibrium directly from Nash's theorem on noncooperative games. No price player is involved, nor are generalized games.
Persistent link: https://www.econbiz.de/10005762752
In our previous paper we built a general equilibrium model of default and punishment in which equilibrium always exists and endogenously determines asset promises, penalties, and sales constraints. In this paper we interpret the endogenous sales constraints as equilibrium signals. By...
Persistent link: https://www.econbiz.de/10005463898
We extend the standard model of general equilibrium with incomplete markets to allow for default and punishment by thinking of assets as pools. The equilibrating variables include expected delivery rates, along with the usual prices of assets and commodities. By reinterpreting the variables, our...
Persistent link: https://www.econbiz.de/10005463908
Introducing default and limited collateral into general equilibrium theory (GE) allows for a theory of endogenous contracts, including endogenous margin requirements on loans. This in turn allows GE to explain liquidity and liquidity crises in equilibrium. A formal definition of liquidity is...
Persistent link: https://www.econbiz.de/10004990661
Many important economic questions arising in auctions can be answered only with knowledge of the underlying primitive distributions governing bidder demand and information. An active literature has developed aiming to estimate these primitives by exploiting restrictions from economic theory as...
Persistent link: https://www.econbiz.de/10004990722
We build a model of competitive pooling, which incorporates adverse selection and signalling into general equilibrium. Pools are characterized by their quantity limits on contributions. Households signal their reliability by choosing which pool to join. In equilibrium, pools with lower quantity...
Persistent link: https://www.econbiz.de/10004990814
We extend the standard model of general equilibrium with incomplete markets to allow for default and punishment. The equilibrating variables include expected delivery rates, along with the usual prices of assets and commodities. By reinterpreting the variables, our model encompasses a broad...
Persistent link: https://www.econbiz.de/10005087374
The possibility of default limits available liquidity. If the potential default draws nearer, a liquidity crisis may ensue, causing a crash in asset prices, even if the probability of default barely changes, and even if no defaults subsequently materialize. Introducing default and limited...
Persistent link: https://www.econbiz.de/10005593327