We study competitive equilibria with moral hazard in economies with aggregate risk and where trading occurs with an incomplete set of financial assets (this version preliminarly analyzes economies with trading in only one asset). The main conclusion of the paper is that, contrary to the...

We consider a model of endogenous occupational choice in economies with a continuum of individuals who differ in their wealth endowments. Individuals have a choice of remaining self-employed or engaging in productive matches with other individuals, i.e., forming ``firms''. Such matches are...