Journal Article

No. 2012-12 | April 05, 2012
Existence of Exact Walrasian Equilibria in Nonconvex Economies PDF Icon

Abstract

The existence of an exact Walrasian equilibrium in nonconvex economies is still a largely unexplored issue. This paper shows that such an equilibrium exists in nonconvex economies by following the ‘nearby economy’ approach introduced by Postlewaite and Schmeidler (Approximate Walrasian Equilibrium and Nearby Economies, 1981) for convex economies. More precisely, the paper shows that any equilibrium price of the convexified version of a nonconvex economy is an equilibrium price also for a set of ‘perturbed’ economies with the same number of agents. It shows that in this set there are economies that differ from the original economy only as regards preferences or initial endowments.

JEL Classification

C62 D51

Citation

Antonio D’Agata (2012). Existence of Exact Walrasian Equilibria in Nonconvex Economies. Economics: The Open-Access, Open-Assessment E-Journal, 6 (2012-12): 1—16. http://dx.doi.org/10.5018/economics-ejournal.ja.2012-12

Assessment

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Comments and Questions


Antonio D'Agata - amendement on my article
May 07, 2012 - 09:19

I would like to add the attached amendment on my article