Equilibrium Concepts in the Large Household Model
Tao Zhu ()
Working Papers from Cornell University, Center for Analytic Economics
This paper formulates two alternative equilibrium concepts in the large household model: one which allows individual household agents to make choices in their separate meetings, and the other which commits individual household agents to contingent actions prior to their meetings. In the first formulation, large converts a model with nonlinear preferences for the household into one with quasi-linear preferences for the individual household's agents, which is critical to make degeneracy--all households experience the same distribution of meeting outcomes--as an equilibrium; in the second formulation, commitment instead of large is the critical factor.
JEL-codes: D51 E40 E50 (search for similar items in EconPapers)
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Journal Article: Equilibrium concepts in the large-household model (2008)
Working Paper: Equilibrium Concepts in the Large Household Model (2007)
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Persistent link: https://EconPapers.repec.org/RePEc:ecl:corcae:07-01
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