Contents: Time and Uncertainty in General Equilibruim Theory/ Overlapping Generations Economies.
The developments of economic theory in the 1950s served to pinpoint important underlying assumptions in the study of market institutions. The conflict between observed institutions and the benchmark interpretation became apparent. This led to the introduction of new equilibrium concepts. The emphasis was on the possibilities to transfer purchasing power over time using spot markets involving assets or money. This advanced textbook focuses on the developments in the theory of incomplete markets and overlapping generations economies where income transfers over time are restricted either by available assets or by the unfeasibility of contracts with unborn generations. It bridges the gap between standard textbooks on microeconomics and more advanced expositions. Contains diagrams, examples and exercises.
1 Consumers and Economies - A Review.- 2 Economies over Time.- 3 Assets and Income Transfers.- 4 Economies with Uncertainty.- 5 Existence and Determinacy.- 6 Optimality and Incomplete Markets.- 7 Overlapping Generations Economies.- 8 Optimal Allocations in OG Economies.- 9 Stationary OG Economies.- 10 Global Dynamics: Turnpike Equilibria.- 11 Global Dynamics: Cyclical Equilibria.- Appendix A Some Results from Calculus.- Appendix B Quadratic Forms and Bordered Matrices.- Appendix C Separation Theorems and Farkas' Lemma.- Appendix D Dynamical Systems.- List of Notation.