General equilibrium, wariness and efficient bubbles

Araujo, A, Novinski, R and Páscoa, MR (2011) General equilibrium, wariness and efficient bubbles Journal of Economic Theory, 146 (3). pp. 785-811.

Full text not available from this repository.

Abstract

Wary consumers overlook gains but not losses in remote sets of dates or states. As preferences are upper but not lower Mackey semi-continuous, Bewley's (1972) [4] result on existence of equilibrium whose prices are not necessarily countably additive holds. Wariness is related to lack of myopia and to ambiguity aversion (and, therefore, to Bewley's (1986) [6] work on Knightian uncertainty). Wary infinite lived agents have weaker transversality conditions allowing them to be creditors at infinity and for bubbles to occur in positive net supply assets completing the markets. There are efficient allocations that can only be implemented with asset bubbles. © 2011 Elsevier Inc.

Item Type:	Article
Divisions :	Surrey research (other units)
Authors :	Araujo, A, Novinski, R and Páscoa, MR
Date :	1 May 2011
DOI :	10.1016/j.jet.2011.01.005
Depositing User :	Symplectic Elements
Date Deposited :	16 May 2017 15:12
Last Modified :	24 Jan 2020 14:04
URI:	http://epubs.surrey.ac.uk/id/eprint/817921

Actions (login required)

View Item

Downloads