Endogenous Uncertainty in a General Equilibrium Model with Price Contingent Contracts
作者： Mordecai Kurz , Ho-Mou Wu
DOI: 10.2139/SSRN.756
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摘要: This paper views uncertainty and economic fluctuations as being primarily endogenous internally propagated phenomena. The most important Endogenous Uncertainty examined in this is price which arises when agents do not have structural knowledge are compelled to make decisions on the basis of their beliefs. We assume that adopt Rational Beliefs Kurz [1994a]. trading accomplished by using Price Contingent Contracts (PCC) rather than Arrow-Debreu state contingent contracts. provides a full construction "price space" requires expansion exogenous space include "state beliefs." central analysis equilibrium with an existence theorem for Belief Equilibrium PCC. It shows how PCC completes markets lead allocation Pareto optimal. also demonstrates generically present new equilibrium.
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