Underemployment of Resources and Self-Fulfilling Beliefs: Nonwalrasian Allocations at Walrasian Prices

Abstract : In this paper the existence of unemployment is partly explained as being the result of coordination failures. It is shown that as a result of self-fulfilling pessimistic expectations, even at Walrasian prices, a continuum of equilibria results, among which an equilibrium with approximately no trade and a Walrasian equilibrium. These coordination failures also arise at other price systems, but then unemployment is the result of both a wrong price system and coordination failures. Some properties of the set of equilibria are analyzed. Generically, there exists a continuum of non-indifferent equilibrium allocations. Under a condition implied by gross substitutability, there exists a continuum of equilibrium allocations in the neighborhood of a competitive allocation, when prices are Walrasian. For a specialized economy, a dynamic illustration is offered.
Type de document :
Pré-publication, Document de travail
2001
Liste complète des métadonnées

Littérature citée [25 références]  Voir  Masquer  Télécharger

https://hal-sciencespo.archives-ouvertes.fr/hal-01064886
Contributeur : Spire Sciences Po Institutional Repository <>
Soumis le : mercredi 17 septembre 2014 - 13:16:21
Dernière modification le : jeudi 11 janvier 2018 - 06:19:32
Document(s) archivé(s) le : jeudi 18 décembre 2014 - 11:01:33

Fichier

cres-dreze-wp.pdf
Fichiers produits par l'(les) auteur(s)

Identifiants

  • HAL Id : hal-01064886, version 1
  • SCIENCESPO : 2441/10287

Collections

Citation

Alessandro Citanna, Hervé Crès, Jacques H Drèze, P. Jean-Jacques Herings, Antonio Villanacci. Underemployment of Resources and Self-Fulfilling Beliefs: Nonwalrasian Allocations at Walrasian Prices. 2001. 〈hal-01064886〉

Partager

Métriques

Consultations de la notice

162

Téléchargements de fichiers

129