On the stability of nonsunspot equilibria

Abstract

This paper analyzes the stability of the (Pareto efficient) nonsunspot equilibria as a function of the constraints faced by consumers in their ability to transfer wealth between states of nature. The nonsunspot equilibria are independent of the constraints since they can be identified to the equilibria of the associated certainty economy. It is shown that… (More)
DOI: 10.1016/j.jet.2010.09.002

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