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We consider production economies where multiple agents make goods according to their inherent production recipe. Daily agents bring goods to the market along with a monetary budget that they allocate across these goods in competitive bids. Goods are distributed in proportion to the bids they attract, with sellers collecting the corresponding revenues. Agents then use their acquired bundles as raw ingredients for the next day's production. We analyse a dynamic known as proportional response, where agents adjust their bids on goods proportionally to returns on past investments: a tit-for-tat like market behaviour. We show these dynamics lead to growth of the economy, whenever growth is feasible within the parameters of the model. The dynamics implicitly learn a key global feature of the network—the most efficient production cycles—through local interactions among the agents who communicate only with their immediate neighbours, with information flowing across the network edges. However, the dynamics also lead to unbounded inequality, i.e. very rich and very poor agents emerge and the gaps between their fortunes expand over time. We analyse several other phenomena, such as the existence of free-riding in star networks, where an agent may have growing fortune without participating in any efficient production cycle if they have strong enough connections with the centre. [ABSTRACT FROM AUTHOR]

We consider a general equilibrium model of a private ownership economy with consumption and production externalities. The choices of all agents (households and firms) may affect utility functions and production technologies. The allocation of a competitive equilibrium is a Nash equilibrium. We provide an example showing that, under standard assumptions, competitive equilibria are indeterminate in an open set of the household's endowments. Next, we consider a new version of this model, with firms' endowments in the spirit of Geanakoplos et al. (J Math Econ 19:113-151, 1990). In our model, firms' endowments impact the technologies of the other firms. We then prove that, generically in the space of endowments of households and firms, each economy has a finite number of competitive equilibria and each competitive equilibrium is locally a differentiable map of the fundamental parameters. [ABSTRACT FROM AUTHOR]

Judd et al. (J Finance 63: 2203–2217, 2003) show that the stationary Lucas tree model cannot generate nontrivial asset trading: Heterogenous agents will optimally choose a fixed portfolio after initial rebalancing. This paper explores asset trading volume in production economies with heterogeneous agents and dynamically complete market structures. We establish a recursive version of the Negishi approach to prove the existence of a competitive equilibrium. Furthermore, we develop a general method to solve for equilibrium portfolios in production economies within a fairly general set of complete market structures. We thus establish the theoretical reasons why production economies in general generate a nontrivial volume of asset trading even if heterogeneity of the agents is kept to a minimum. [ABSTRACT FROM AUTHOR]

This paper discusses Yee (), who investigates the role of accounting information for consumption planning and equity valuation. Higher earnings quality increases investor welfare and ex ante stock prices as well as the weight on earnings in valuation equations based on both cash flows and earnings. The former is due to improved consumption smoothing through more informed production choices, while the latter is due to the impact on the relative information content of current cash flows versus earnings about future cash flows. [ABSTRACT FROM AUTHOR]

The main objects here are games in which players mainly compete but nonetheless collaborate on some subsidiary activities. Play assumes a two-stage nature in that first-stage moves presume coordination of some subsequent tasks. Specifically, we consider instances where second-stage coordination amounts to partial cost sharing, anticipated and sustained as a core solution. Examples include regional Cournot oligopolies with joint transportation. We define and characterize equilibria, and inquire about their existence. [Copyright &y& Elsevier]

This paper introduces the notion of Market Equilibrium With Active Consumers (MEWAC), in order to characterize the efficiency of market outcomes in production economies. We show that, no matter the behaviour followed by the firms, a market equilibrium is efficient if it is a MEWAC. And also that every efficient allocation can be decentralized as a MEWAC in which firms follow the marginal pricing rule. [ABSTRACT FROM AUTHOR]

A cooperative game in characteristic-function form is obtained by allowing a number of individuals to esercise partial control over the constraints of a (generally nonlinear) mathematical programming problem, either directly or through committee voting. Conditions are imposed on the functions defining the programming problem and the control system which suffice to make the game totally balanced. This assures a nonempty core and hence a stable allocation of the full value of the programming problem among the controlling palyers. In the linear case the core is closely related to the solutions of the dual problem. Applications are made to a variety of economic models, including the transferable utility trading economies of Shapley and Shubik and a multishipper one-commodity transshipment model with convex cost functions and concave revenue functions. Dropping the assumption of transferable utility leads to a class of controlled multiobjective or 'Pareto programming' problems, which again yield totally balanced games. [ABSTRACT FROM AUTHOR]