Determinacy of equilibria in dynamic models with finitely many consumers
Timothy Kehoe,
David Levine and
Paul Romer
No 118, Staff Report from Federal Reserve Bank of Minneapolis
Abstract:
We consider a production economy with a finite number of heterogeneous, infinitely lived consumers. We show that, if the economy is smooth enough, equilibria are locally unique for almost all endowments. We do so by converting the infinite-dimensional fixed point problem stated in terms of prices and commodities into a finite-dimensional Negishi problem involving individual weights in a social value function. By adding artificial fixed factors to utility and production functions, we can write the equilibrium conditions equating spending and income for each consumer entirely in terms of time-zero factor endowments and derivatives of the social value function.
Keywords: Production (Economic theory); Consumption (Economics) (search for similar items in EconPapers)
Date: 1989
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Citations: View citations in EconPapers (16)
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Related works:
Journal Article: Determinacy of equilibria in dynamic models with finitely many consumers (1990) 
Working Paper: Determinacy of Equilibrium in Dynamic Models with Finitely Many Consumers (1990) 
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Persistent link: https://EconPapers.repec.org/RePEc:fip:fedmsr:118
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