Incomplete Markets and the Firm

Egbert Dierker, Hildegard Dierker and Birgit Grodal
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Hildegard Dierker: University of Vienna

No 1999-05, CIE Discussion Papers from University of Copenhagen. Department of Economics. Centre for Industrial Economics

Abstract: In this paper we analyze the welfare properties of the set of Drèze equilibria for economies with incomplete markets and firms. The well known fact that a Drèze equilibrium need not be constrained Pareto optimal is often attributed to a lack of coordination between firms. We show that there are economies with a single firm in which no Drèze equilibrium is constrained Pareto efficient. Even a unique Drèze equilibrium need not be constrained Pareto efficient.

Keywords: incomplete markets; firms' objectives; Drèze equilibria; efficiency (search for similar items in EconPapers)
JEL-codes: D4 D5 D6 L2 (search for similar items in EconPapers)
Pages: 28 pages
Date: 1999-03
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Citations: View citations in EconPapers (3)

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Related works:
Working Paper: Incomplete Markets and the Firm (1999)
Working Paper: Incomplete Markets and the Firm (1999)
Working Paper: Incomplete Markets and the Firm (1999)
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Persistent link: https://EconPapers.repec.org/RePEc:kud:kuieci:1999-05

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