Intertemporal Cournot and Walras equilibria: An illustration

Tito Cordella, Manjira Datta

Research output: Contribution to journalArticle

4 Scopus citations

Abstract

In an intertemporal general equilibrium framework, we compare a Cournot equilibrium to the Walras equilibrium. The Cournot agents trade and invest less than the Walras agents. This generates an inefficiency that does not vanish as the number of Cournot agents tends to infinity. A larger number of strategic Cournot agents implies that the amount of trade (relative to their aggregate consumption) increases (i.e., it moves towards the Walrasian amount), but their investment (relative to the stock) decreases (i.e., it moves away from the Walrasian amount).

Original languageEnglish (US)
Pages (from-to)137-153
Number of pages17
JournalInternational Economic Review
Volume43
Issue number1
DOIs
StatePublished - Jan 1 2002

ASJC Scopus subject areas

  • Economics and Econometrics

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