Markets and contracts

Alberto Bisin (), John Geanakoplos, Piero Gottardi (), Enrico Minelli and Herakles Polemarchakis

No ECO2010/29, Economics Working Papers from European University Institute

Abstract: Economies with asymmetric information are encompassed by an extension of the model of general competitive equilibrium that does not require an explicit modeling of private information. Sellers have discretion over deliveries on contracts; this is in common with economies with default, incomplete contracts or price rigidities. Competitive equilibria exist and anonymous markets are viable. But, for a generic economy, there exist Pareto improving interventions via linear, anonymous taxes.

Keywords: asymmetric information; competitive markets; equilibrium (search for similar items in EconPapers)
JEL-codes: D50 D52 D82 (search for similar items in EconPapers)
New Economics Papers: this item is included in nep-cba and nep-cta
Date: 2010
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Related works:
Journal Article: Markets and contracts (2011)
Working Paper: Markets and Contracts (2011)
Working Paper: Markets and Contracts (2009)
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Persistent link: http://EconPapers.repec.org/RePEc:eui:euiwps:eco2010/29

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