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Equilibrium Correspondence of Linear Exchange Economies

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Abstract

According to Mertens (Ref. 1), the set of equilibrium prices in a linear exchange economy is a convex polyhedral cone (after adding {0}). We give a constructive proof of this fact. Then, we establish a lower-semicontinuity property of the equilibrium price correspondence. The set of equilibrium allocations is a closed, convex polyhedron. We give a characterization of this set.

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Authors and Affiliations

  1. CERMSEM, Université de Paris 1, Paris, France

    M. Florig (Assistant Professor)

Authors
  1. M. Florig
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Florig, M. Equilibrium Correspondence of Linear Exchange Economies. Journal of Optimization Theory and Applications 120, 97–109 (2004). https://doi.org/10.1023/B:JOTA.0000012734.59679.9a

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  • DOI: https://doi.org/10.1023/B:JOTA.0000012734.59679.9a

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