Recent advances on uniqueness of competitive equilibrium

Toda, Alexis Akira; Walsh, Kieran James

doi:10.1016/j.jmateco.2024.103008

Journal of Mathematical Economics

2024

DOI: 10.1016/j.jmateco.2024.103008

|View full text |Cite

Recent advances on uniqueness of competitive equilibrium

Alexis Akira Toda,

Kieran James Walsh

Help me understand this report

Search citation statements

Order By: Relevance

Paper Sections

Select...

Citation Types

Supporting

Mentioning

Contrasting

Year Published

2024

Publication Types

Select...

Other1

Relationship

Self Cite0

Independent1

Authors

Journals

Cited by 1 publication

References 80 publications

Supporting

Mentioning

Contrasting

Order By: Relevance

Equilibrium Multiplicity in Aiyagari and Krusell-Smith

Walsh,

Young

2024

Working Paper (Federal Reserve Bank of Cleveland)

View full text Add to dashboard Cite

Repeatedly solving the Aiyagari (1994) model with random parameters, we construct hundreds of examples with multiple stationary equilibria. We never find multiplicity with risk aversion less than ≈ 1.49, depreciation less than ≈ 0.19, or income persistence less than ≈ 0.47, and multiplicity requires a disaster state for income. In cases with multiplicity, the lowest rental rate occurs near depreciation times the capital share. It is possible for the economy, without a change in fundamentals, to transition rationally from a higher-rate equilibrium to one with a lower rental rate, lower inequality, and lower welfare (for most agents). We also construct the first Krusell and Smith (1998) examples with multiple recursive competitive equilibria.

show abstract

Equilibrium Multiplicity in Aiyagari and Krusell-Smith

Walsh,

Young

2024

Working Paper (Federal Reserve Bank of Cleveland)

View full text Add to dashboard Cite

show abstract

scite is a Brooklyn-based organization that helps researchers better discover and understand research articles through Smart Citations–citations that display the context of the citation and describe whether the article provides supporting or contrasting evidence. scite is used by students and researchers from around the world and is funded in part by the National Science Foundation and the National Institute on Drug Abuse of the National Institutes of Health.

Contact Info

hi@scite.ai

10624 S. Eastern Ave., Ste. A-614

Henderson, NV 89052, USA

Blog Terms and Conditions API Terms Privacy Policy Contact Cookie Preferences Do Not Sell or Share My Personal Information

Made with 💙 for researchers

Part of the Research Solutions Family.

Recent advances on uniqueness of competitive equilibrium

Cited by 1 publication

References 80 publications

Equilibrium Multiplicity in Aiyagari and Krusell-Smith

Equilibrium Multiplicity in Aiyagari and Krusell-Smith

Contact Info

Product

Resources

About