The Strong Sequential Core for Two-period Economies

P. Jean-Jacques Herings and H. Peeters

Microeconomics from University Library of Munich, Germany

Abstract: The strong sequential core for two-stage economies with a possibly incomplete set of assets in period zero and trade in commodities in period one consists of those goods allocatioans that are in the classical core and moreover, after realization of the state of nature, in the endowments. The strong sequential core coincides with the classical core when all possible state-contigent contracts may serve as an asset. For finance economies it is shown that the strong sequential core is generically empty when there is an incomplete set of assets. Outside the setting of finance economies, we show that the strong sequential core can be empty even if there is an complete set of assets. If the set of constrained feasible allocations resulting from trading in assets, is enlarged to include also allocations outside the agents'comsumption sets, then a complete set of assets is sufficient for the equivalence of the resulting semi-strong sequential core and the classical core.

JEL-codes: D1 D2 D3 D4 (search for similar items in EconPapers)
Pages: 24 pages
Date: 2001-11-12
Note: Type of Document - pdf.format; pages: 24
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Related works:
Journal Article: The strong sequential core for two-period economies (2002)
Working Paper: The strong sequential core for two-period economies (2001)
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Persistent link: https://EconPapers.repec.org/RePEc:wpa:wuwpmi:0111002

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