Coarse Competitive Equilibrium and Extreme Prices

Faruk Gul, Wolfgang Pesendorfer () and Tomasz Strzalecki

Working Paper from Harvard University OpenScholar

Abstract: We introduce a notion of coarse competitive equilibrium (CCE), to study agents' inability to tailor their consumption to the state of the economy. Our notion is motivated by limited cognitive ability (in particular attention, memory, and complexity) and it maintains the complete market structure of competitive equilibrium. Compared to standard competitive equilibrium, our concept yields riskier allocations and more extreme prices. We provide a tractable model that is suitable for general equilibrium analysis as well as asset pricing.

References: Add references at CitEc
Citations: View citations in EconPapers (11)

Downloads: (external link)
http://scholar.harvard.edu/tomasz/node/8365
Our link check indicates that this URL is bad, the error code is: 404 Not Found (http://scholar.harvard.edu/tomasz/node/8365 [301 Moved Permanently]--> https://tomasz.scholars.harvard.edu//node/8365)

Related works:
Journal Article: Coarse Competitive Equilibrium and Extreme Prices (2017)
Working Paper: Coarse Competitive Equilibrium and Extreme Prices (2014)
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:qsh:wpaper:8365

Access Statistics for this paper

More papers in Working Paper from Harvard University OpenScholar Contact information at EDIRC.
Bibliographic data for series maintained by Richard Brandon ( this e-mail address is bad, please contact ).