This paper is about instability of equilibrium real rents in a pure exchange economy. Our main result hinges upon a low degree of substitutability between housing services and other commodities together with a low share of owner-occupied houses. We argue that regions or economies with a low...

This paper presents a simple model of housing cycles in a two good economy. We establish that nonsubstitutability between housing services and other commodities along with high degree of heterogeneity in home ownership may lead to a stable spiral path converging to a steady-state equilibrium of...

Recent studies in behavioral finance establish that active traders may underperform those who trade less. Such a result is partly due to the persistently high annual net returns earned by well-diversified portfolios in stock markets. This paper shows that the buy-and-hold strategy as a nonactive...

In this paper, we present a simple axiomatization of the n-person egalitarian solution. The single condition sufficient for characterization is a new axiom, called symmetric decomposability that combines the axioms of step-by-step negotiations, symmetry, and weak Pareto optimality used in an...