The structure of the set of critical equilibria with incomplete markets (Q1300432)

An economy with two periods, today and tomorrow, is considered. The latter one is connected with uncertainty represented by a finite set of states of nature. The main interest is focused to the equilibrium set and its formal structure. The main result of the paper shows that the subset of critical equilibria is closed and it has the measure zero in the equilibrium set. As a consequence of this result, it is shown that also the subset of critical economies is closed and it has the measure zero in the sets of economies. Moreover, one of the auxiliary shows that the equilibrium set of the considered type of economy forms a manifold.