Equilibrium Theory: A Salient Approach.

Abstract

Abstract: Whereas the neoclassical models in General Equilibrium Theory focus on the existence of separate commodities, this thesis regards 'bundles of trade' as the unit objects of exchange. Apart from commodities and commodity bundles in the neoclassical sense, the term `bundle of trade' includes, for example, fixed pre-packed commodity bundles and exchangeable objects which are solely defined and valued by their characteristics. In the first part of the thesis, the new mathematical concept of salient space is formalised and thoroughly investigated. In the second part, several models of exchange economies are stated, each constructed around the set consisting of all bundles of trade. This set is represented in a natural way by a salient space. Finally, for each model one or more equilibrium existence theorems are presented and proven.