Finiteness of the Number of Equilibria in a Production Economy with Uncertainty

This paper shows that the inverse image of the natural projection defines a ramified covering with finite layers. Finiteness of equilibria for regular two period production economies with uncertainty follows from this property.General Equilibrium, Uncertainty, Production.

A General Equilibrium Corporate Finance Theorem for Incomplete Markets: A Special Case

This paper considers corporate equilibria in a two period endogenized asset general equilibrium model for a class of profit maximizing objective functions of the firms introduced in Stiefenhofer (2009). It shows by means of a particular case that for a fixed financial policy, every extensive form stock market equilibrium can be translated into a reduced form equilibrium. This suggests determinateness of corporate equilibria for varying financial parameters. A change in the firm's financial policy changes the production set available to it in the next period, hence real effects.

Production in General Equilibrium with Incomplete Markets

Short and long run production is introduced in a two period general equilibrium model with incomplete markets, where firms are profit maximizers. They maximize profits in the long run, which implies profit maximization over both periods. The sequential structure of the model is such that, firms issue shares in the short run in order to build up long run production capacity. Long run production takes place in the second period subject to long run technological feasibility and installed capacity constraints. It is shown that equilibrium exists generically.General Equilibrium, Incomplete Markets, Production.

Endogenous Incomplete Markets: A Production Model with Idiosyncratic Risk

This paper considers a two period general equilibrium production model with incomplete markets (GEI). The novelty of this model is the endogenous smooth asset structure introduced in Stiefenhofer (2010). It is shown that incomplete markets is a consequence of idiosyncratic risk.

A Theorem on the Decentralization of the Objective Function of the Firm in GEI

This paper introduces a separation theorem for a two period general equilibrium model with endogenized asset structures and incomplete income transfer space. This theorem separates the activities of the consumers from the activities of the firms. The result improves on the objective function introduced in Drèze (1974) and Grossman and Hart (1979), which is not independent of an exogenously assigned present value derived from the utilities of the owners of the firm.Objective Function, Incomplete Markets, Prot Maximization

Equilibrium Structure of Production Economies with Uncertainty: The Natural Projection Approach

The paper generalizes the natural projection approach introduced by Balasko (1988) to production economies with uncertainty. It explores the equilibrium structure of the long run and short run private ownership production model. It is shown that qualitative equilibrium properties of the production model are those of the exchange model with production adjusted demand functions.Existence of Equilibrium, Equilibrium Structure, Uncertainty, Production.

A Geometric Separation of the Economic Activities of the Agents: The Leading Example

The paper considers production in a simple two period general equilibrium model with incomplete markets. It shows, by application of convex sets analysis, the separation of economic activities of the agents. The paper improves on Stiefenhofer (2010) by taking a geometric approach to the study of the decentralization theorem. This theorem separates the economic activities of the agents, hence generalizes the objective function of the firm of the Arrow-Debreu model to the case of incomplete markets, where firms are profit maximizers.

Corporate Equilibrium Properties of a Centralized Objective Function GEI Model

We introduce an incomplete markets general equilibrium model with idiosyncratic risk, where production is financed via stock market, and where the ownership structure endogenized. This model is a variation of Drèze (1974), Grossman and Hart (1979), and Magill and Quinzii (2002). The paper discusses two main corporate equilibrium properties. It shows that (i) the class of centralized objective functions introduces a further source of inefficiency into the organization of production, and (ii) the indeterminacy of corporate equilibria. (iii) It further shows the separation of the economic decisions of the agents.

Endogenized Production Sets in a General Equilibrium Model with Incomplete Markets

The paper develops a general equilibrium model with incomplete markets where the asset structure is endogenized. This asset structure allows to consider a new class of objective functions of profit maximizing firms. This class of objective functions is independent of the utilities of the stock holders. Corporate equilibrium properties are studied for this model. It is shown that the organization of production is generally efficient. This result is a consequence of the generalization of the separation theorem of the Arrow-Debreu model to incomplete markets. Finally, the paper shows that corporate equilibria are not independent of the firms financial activities.