On the Existence of Equilibrium in Bewley Economies with Production

Omer Acikgoz

MPRA Paper from University Library of Munich, Germany

Abstract: I provide a proof of existence of stationary recursive competitive equilibrium in Bewley economies with production under very permissive assumptions. In particular, (i) utility function is allowed to be unbounded, and (ii) the underlying discrete idiosyncratic productivity process is allowed to take any form, aside from mild restrictions. Some of the intermediate results provide theoretical basis for assumptions often made in the quantitative macroeconomics literature.

Keywords: Recursive Competitive Equilibrium; Bewley/Huggett/Aiyagari model (search for similar items in EconPapers)
JEL-codes: C62 E00 E21 (search for similar items in EconPapers)
Date: 2015-12-20
New Economics Papers: this item is included in nep-mac and nep-upt
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