Two-period economies with price-contingent deliveries

Joao Correia-da-Silva

FEP Working Papers from Universidade do Porto, Faculdade de Economia do Porto

Abstract: An economy with ex ante markets for future delivery contingent on ex post spot market prices is considered. Since spot prices are publicly observed ex post, this framework bypasses the enforcement problems that may arise as a result of differential information about states of nature. Generically, the equilibria of an economy with price-contingent deliveries coincide with the equilibria of the corresponding economy with state-contingent deliveries. However, replacing state-contingent deliveries with price-contingent deliveries may generate additional equilibria and/or remove some equilibria. The perfect foresight hypothesis is crucial to avoid a severe problem of nonexistence of equilibrium.

Keywords: General equilibrium; price-contingent deliveries; differential information (search for similar items in EconPapers)
JEL-codes: C62 C72 D51 D82 (search for similar items in EconPapers)
Pages: 23 pages
Date: 2014-03
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
http://www.fep.up.pt/investigacao/workingpapers/wp529.pdf (application/pdf)
Our link check indicates that this URL is bad, the error code is: 404 Not Found (http://www.fep.up.pt/investigacao/workingpapers/wp529.pdf [302 Found]--> https://fep.up.pt/investigacao/workingpapers/wp529.pdf)

Related works:
Journal Article: Two-period economies with price-contingent deliveries (2015)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:por:fepwps:529

Access Statistics for this paper

More papers in FEP Working Papers from Universidade do Porto, Faculdade de Economia do Porto Contact information at EDIRC.
Bibliographic data for series maintained by ().