General equilibrium theory and increasing returns: an alternative to the survival assumption

Jean-Marc Bonnisseau and Alexandrine Jamin (alexandrinej@yahoo.fr)
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Alexandrine Jamin: CERMSEM

Cahiers de la Maison des Sciences Economiques from Université Panthéon-Sorbonne (Paris 1)

Abstract: Existence results for equilibria in economies under increasing returns to scale, fixed costs, or showing more general types of non convexity in the production sector, strongly rest on a crucial condition, known as the survival assumption. This assumption is unsatisfactory in the sense that it poses a condition on the set of production equilibria, an endogenous variable. We propose here conditions on the firms’ characteristics, notably on the firms' pricing behaviour, under which the equilibrium existence can be proved

Keywords: General Equilibrium Theory; increasing returns; survival assumption (search for similar items in EconPapers)
JEL-codes: C62 C67 D21 D51 (search for similar items in EconPapers)
Pages: 6 pages
Date: 2004-02
New Economics Papers: this item is included in nep-mic
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Persistent link: https://EconPapers.repec.org/RePEc:mse:wpsorb:b04017

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