Markets, Bargaining, and Networks with Heterogeneous Agents

Financial Markets Equilibrium with Heterogeneous Agents

This paper presents an equilibrium model in a pure exchange economy when investors have three possible sources of heterogeneity. Investors may differ in their beliefs, in their level of risk aversion and in their time preference rate. We study the impact of investors heterogeneity on the properties of the equilibrium. In particular, we analyze the consumption shares, the market price of risk, t...

Modeling Financial Markets with Heterogeneous Agents

Nash Networks with Heterogeneous Agents

A non-cooperative model of network formation is developed. Agents form links with others based on the cost of the link and its assessed beneÞt. Link formation is one-sided, i.e., agents can initiate links with other agents without their consent, provided the agent forming the link makes the appropriate investment. Information ßow is two-way. The model builds on the work of Bala and Goyal, but a...

Fiscal Policy with Heterogeneous Agents and Incomplete Markets

I undertake a quantitative investigation into the short run effects of changes in the timing of taxes for model economies in which heterogeneous households face a borrowing constraint. A combination of the distortionary effects of non-lump-sum taxation and the liquidity effects arising from the asset market structure are found to imply large real effects from tax changes. For example, a tempora...

Marriage Markets and Bargaining Marriage Markets and Bargaining Between Spouses