From Walrasian General Equilibrium to Incomplete Contracts: Making Sense of Institutions

Walrasian Price Equilibrium

Walrasian Equilibrium with Gross Substitutes

Sloan Foundation for their support. We are grateful to Vincent Crawford who provided valuable comments and pointed out to us the connection between Kelso and Crawford [5] and our work, to John Geanakoplos for suggesting a weakening of our main assumption, and to Don Brown for valuable comments.

General Equilibrium with Endogenously Incomplete Financial Markets

The present paper studies a class of general equilibrium economies with imperfectly competitive financial intermediaries and price-taking consumers. Intermediaries optimally choose the securities they issue and the bid-ask spread they charge. Financial intermediation is costly, and hence markets are endogenously incomplete. An appropriate equilibrium concept is developed, and existence is prove...

General Equilibrium, Incomplete Markets and Macroeconomics

An Introduction to General Equilibrium with Incomplete Asset Markets*

The theory of general equilibrium with incomplete asset markets (GEI) studies the pricing of securities and commodities, and the interactions of perfectly competitive asset markets and commodity markets in determining consumption and investment. Since financial economics is fundamentally concerned with the pricing of securities, and since macroeconomics is fundamentally concerned with the real ...