Non-myopic learning in differential information economies: the core

Summary. We study the process of learning in a differential information economy, with a continuum of states of nature that follow a Markov process. The economy extends over an infinite number of periods and we assume that the agents behave non-myopically, i.e., they discount the future. We adopt a new equilibrium concept, the non-myopic core. A realized agreement in each period generates information that changes the underlying structure in the economy. The results we obtain serve as an extension to the results in Koutsougeras and Yannelis (1999) in a setting where agents behave non-myopically. In particular, we examine the following two questions: 1) If we have a sequence of allocations that are in an approximate non-myopic core (we allow for bounded rationality), is it possible to find a subsequence that converges to a non-myopic core allocation in a limit full information economy? 2) Given a non-myopic core allocation in a limit full information economy can we find a sequence of approximate non-myopic core allocations that converges to that allocation? Received: May 25, 1999; revised version: August 9, 1999     

Oligopoly equilibria in exchange economies: a limit theorem

In a pure exchange economy, agents have the possibility of behaving strategically by putting only a part of their initial endowments on the market. An oligopoly equilibrium is defined to be a Nash equilibrium of the game in which agents choose simultaneously quantities to be put on the market. It is proved that under standard hypotheses, the oligopoly equilibrium leads to the competitive equilibrium when the economy is replicated an infinite number of times. Received: May 26, 1999; revised version: April 3, 2000     

Money, banks and endogenous volatility

Summary. In this paper I consider a monetary growth model in which banks provide liquidity, and the government fixes a constant rate of money creation. There are two underlying assets in the economy, money and capital. Money is dominated in rate of return. In contrast to other papers with a larger set of government liabilities, I find a unique equilibrium when agents' risk aversion is moderate. However, indeterminacies and endogenous volatility can be observed when agents are relatively risk averse. Received: March 11, 1999; revised version: March 30, 1999     

Signaling in markets with two-sided adverse selection

Summary. The paper analyzes an economy with two-sided adverse selection, focusing on equilibria that satisfy a refinement based on the notion of strategic stability. In the familiar case of one-sided adverse selection, agents reveal all of their private information as long as the contract space is rich enough. However, with two-sided adverse selection, the sufficient conditions for separation are much stronger. Received: September 3, 1999; revised version: December 3, 1999     

Factors substitutability,heterogeneity and endogenous fluctuations in a finance constrained economy

Summary.   This paper examines the local properties of perfect foresight equilibrium of a finance constrained economy featuring two classes of infinitely-lived agents with heterogeneous general preferences. It is primarily concerned with the conceivability of endogenous fluctuations for large plausible capital-labor elasticities of substitution. It is notably shown that heterogeneity in preferences allows Hopf cycles to be entirely consistent with a wide range of elasticities of substitution including the unitary one (Cobb-Douglas specifications). Received: April 23, 1999; revised version: January 24, 2000     

Inequalities and fluctuations in a dynamic general equilibrium model

   Summary. In the present paper a tractable two-sector neo-classical growth model with heterogeneous agents is considered. The local dynamic properties of the equilibrium path are analyzed in relation with the underlying characteristics of the economy. In particular, the existence of fluctuations is related to the degree of heterogeneity in labor and in capital endowments. When applied to international trade theory, the analysis shows that free trade may distabilize a world economy that is originally stable under the regime of autarky. Received: December 28, 1998; revised version: October 29, 1999     

An alternative proof of the nonemptiness of the private core

Summary. We focus on the private core [19] of an economy with a finite number of agents with differential information, a continuum of states and an infinite number of commodities. We state a nonemptiness result for the private core and provide a proof based on a fixed-point argument. Received: October 4, 1999; revised version: June 7, 2000     

Growth and equilibrium indeterminacy: the role of capital mobility

Summary. The paper presents a human capital driven endogenous growth model which, in general, permits a multiplicity of equilibrium balanced growth paths. It is shown that allowing for perfect capital mobility across countries increases the range of parameter values for which the model permits equilibrium indeterminacy. As opposed to the closed capital markets case, simple restrictions on preferences are no longer sufficient to eliminate the indeterminacy. Intuitively, under perfect capital mobility agents are able to smooth consumption completely. This induces an economy with open capital markets to behave like a closed economy with linear preferences thereby increasing the possibility of equilibrium indeterminacy. Received: 18 November 1998; revised version: 10 August 1999     

A reconsideration of the problem of social cost: Free riders and monopolists

Summary. One version of the Coase Theorem is, If property rights are fully allocated, competition leads to efficient allocations. This version implies that the public goods problem can be solved by allocating property rights fully. We show that this mechanism is not likely to work well in economies with global externalities because the privatized economy is highly susceptible to strategic behavior: The free-rider problem manifests itself as a complementary monopoly problem in an associated private goods economy. Thus, our work relates the validity of the Coase Theorem to the literature on the incentives for strategic behavior in economies with complementarities. Received: 12 May 1999; revised version: 9 July 1999     

Incentive compatible core and competitive equilibria in differential information economies

Summary. If the allocations of a differential information economy are defined as incentive compatible state-contingent lotteries over consumption goods, competitive equilibrium allocations exist and belong to the (ex ante incentive) core. Furthermore, any competitive equilibrium allocation can be viewed as an element of the core of the n-fold replicated economy, for every n. The converse holds under the further assumption of independent private values but not in general, as shown by a counter-example. Received: August 9, 1999; revised version: September 12, 1999     

Informational efficiency properties of rational expectations equilibria in non-convex economies

Summary. A simple example shows that although non-convexities might prevent the existence of a fully revealing rational expectations equilibrium, they need not prevent the existence of a non-informative one. Indeed, the economy in this example does not possess any fully revealing equilibria, but does have a continuum of non-informative ones. Received: February 9, 1999; revised version: October 20, 1999     

基于PCA-ESDA的中国省域旅游经济时空差异分析

以中国大陆31个省级区域为研究单元,选取1999—2008年反映旅游经济的相关指标,利用SPSS16.0软件对数据进行主成分分析,计算出每个省份旅游经济的综合得分,然后对综合得分进行空间自相关分析。结果表明:中国旅游经济的发展水平总体上呈现从"长三角"及"珠三角"向内陆逐渐降低的特征。1999—2008年中国旅游经济发展全局空间自相关不显著,但局部空间自相关却表现出一定的规律性:沿海省份位于HH区,西部省份位于LL区,西南、部分东部和中部省份位于LH区和HL区。中国省域旅游经济发展呈现出一种持续的非均衡态势,1999—2008年中国省域旅游经济的总体空间格局并没有发生根本性的变化。省域旅游经济集聚的空间依赖性、省域经济发展水平、区位与资源禀赋、政府政策是影响中国省域旅游经济空间差异的主要原因。     

The bargaining set of a large economy with differential information

Summary. We study the Mas-Colell bargaining set of an exchange economy with differential information and a continuum of traders. We established the equivalence of the private bargaining set and the set of Radner competitive equilibrium allocations. As for the weak fine bargaining set, we show that it contains the set of competitive equilibrium allocations of an associated symmetric information economy in which each trader has the “joint information” of all the traders in the original economy, but unlike the weak fine core and the set of fine value allocations, it may also contain allocations which are not competitive in the associated economy. Received: February 15, 1999; revised version: August 9, 1999     

The hidden economy in Spain – A monetary estimation, 1964–1998

The aim of this paper is to estimate the level and evolution of hidden income in Spain during the period 1964–1997. To this end, we employ the well-known monetary approach which supposes that the hidden economy is a response on the part of the economic agents to the tax burden, one which manifests itself in an excess of demand for currency. The estimation has been made on the basis of the ADL technique, an ECM and Johansen's cointegration approach. The period chosen was characterised by multiple institutional changes, an increase in the tax burden and wide-ranging financial liberalisation. This has obliged us to formulate a specific monetary model to estimate the hidden economy and is one of the original features of that model. First version received: February 1999/Final version received: March 2001     

Temporary financial equilibrium

Summary. In a two-period pure exchange economy with financial assets, a temporary financial equilibrium is an equilibrium of the current spot and security markets given forecast functions of future prices and payoffs. The temporary equilibrium model can then be interpreted as an Arrow-Debreu economy where preferences depend on prices. This identification implies, among other consequences, the existence and the generic determinateness of the financial temporary equilibria associated with given forecast functions. Received: December 29, 1999; revised version: December 20, 2001     

Informational efficiency: ranking markets

Summary. The paper studies informational properties of three types of imperfectly competitive markets: a one-signal speculative market (OSS market) in which agents have only private information about the fundamental value (v) of the risky asset traded, a two-signal speculative market (TSS market) in which agents have private information about both v and the asset supply, and a market in which agents are endowed with both information about v and shares of the risky asset traded. In this last market (JA market), agents have joint activities: they trade for both speculative and hedging purposes. It is shown that (i) the JA market and the OSS market are the most and the least efficient, respectively, and (ii) the levels of informational efficiency in the three markets are inversely correlated with the intensities with which traders use their private information about the fundamental value of the asset. Received May 28, 1999; revised version: May 28, 1999     

Existence of equilibrium in an OLG model with production and altruistic preferences

Summary. This note deals with the existence and uniqueness of a non-trivial steady-state equilibrium in an overlapping generations (OLG) model with productive capital and altruistic agents. We establish a necessary and sufficient condition for operative bequests which extends Abel (1987) and Weil (1987). Interestingly, we prove that the OLG model with production and altruistic agents always experiences a non-trivial steady-state equilibrium. Received: July 16, 1998; revised version: January 29, 1999     

Speculative trade, asset prices and investment levels

Summary. In this paper I consider a dynamically complete market model without intrinsic uncertainty. Agents' beliefs are different, but correct in the limit. Some agents are more patient than others. I show that infinitely often share prices are low and the economy stagnates. Also, infinitely often share prices are high and the economy grows. The changes from growth to stagnation and from stagnation to growth are not caused by exogenous shocks. They are caused by speculative trade among agents with different propensities to save and invest. Received: January 8, 2001; revised version: April 11, 2002 RID="*" ID="*" I thank an anonymous referee for helpful comments. I gratefully acknowledge financial support from the National Science Foundation.     

A simple random assignment problem with a unique solution

Summary. All agents have the same ordinal ranking over all objects, receiving no object (opting out) may be preferable to some objects, agents differ on which objects are worse than opting out, and the latter information is private. The Probabilistic Serial assignment, improves upon (in the Pareto sense) the Random Priority assignment, that randomly orders the agents and offers them successively the most valuable remaining object. We characterize Probabilistic Serial by efficiency in an ordinal sense, and envy-freeness. We characterize it also by ordinal efficiency, strategyproofness and equal treatment of equals. Received: October 5, 1999; revised version: December 20, 2000     

Generic inefficiency of equilibria in the general equilibrium model with incomplete asset markets and infinite time

Summary. We consider a Lucas asset-pricing model with heterogeneous agents, exogenous labor income, and a finite number of exogenous shocks. Although agents are infinitely lived, endowments and dividends are time-invariant functions of the exogenous shock alone and are thus restricted to lie in a finite-dimensional space; genericity analysis can be conducted on sets of zero Lebesgue measure. When financial markets are incomplete, that is, there are fewer financial securities than shocks, we show that generically in individual endowments all competitive equilibria are Pareto inefficient. Received: November 22, 1999; revised version: March 4, 2002 RID="*" ID="*" We are grateful to an anonymous referee for very insightful comments on earlier drafts.