Munich Personal RePEc Archive

General Equilibrium with Endogenous Trading Constraints

Cea-Echenique, Sebastián and Torres-Martínez, Juan Pablo (2014): General Equilibrium with Endogenous Trading Constraints.

[thumbnail of MPRA_paper_55359.pdf]

Download (453kB) | Preview


We build a general equilibrium model where agents are subject to endogenous trading constraints, making the access to financial trade dependent on prices and consumption decisions. Besides, our framework is compatible with the existence of endogenous financial segmentation and credit markets' exclusion. Two results of equilibrium existence are shown. In the first one, we assume individuals can super-replicate financial payments buying durable commodities and investing in assets that give liquidity to all agents. In the second result, under strict monotonicity of preferences, we suppose there are agents that may compensate with increments in present demand the losses of well-being generated by reductions of future consumption.

Atom RSS 1.0 RSS 2.0

Contact us: mpra@ub.uni-muenchen.de

This repository has been built using EPrints software.

MPRA is a RePEc service hosted by Logo of the University Library LMU Munich.