In this paper, we show that the Shapley-Shubik market game model with production naturally generates an equilibration mechanism that can accommodate price stickiness arising from strategic interactions of firms. Unlike New Keynesian models that show similar price stickiness results, the market...

This paper corrects the no arbitrage condition in Vasicek (1977) by pointing out that the instantaneous spot rate is logically zero. The corrected no arbitrage condition admits an extremely simple solution, which allows the latent state factors to be accurately identified from the observable...