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To link to full-text access for this article, visit this link: http://dx.doi.org/10.1016/j.jet.2006.01.007 Byline: Paulo Klinger Monteiro (a), Frank H. Page Jr (b) Abstract: We introduce a condition, uniform payoff security, for games with compact Hausdorff strategy spaces and payoffs bounded and measurable in players' strategies. We show that if any such compact game G is uniformly payoff secure, then its mixed extension G is payoff secure. We also establish that if a uniformly payoff secure compact game G has a mixed extension G with reciprocally upper semicontinuous payoffs, then G has a Nash equilibrium in mixed strategies. We provide several economic examples of compact games satisfying uniform payoff security. Author Affiliation: (a) FGV-EPGE, Praia de Botafogo 190, sala 1103, 22250-900, RJ, Brazil (b) Department of Finance, University of Alabama, Tuscaloosa, AL 35487, USA Article History: Received 26 May 2005; Revised 27 January 2006

To link to full-text access for this article, visit this link: http://dx.doi.org/10.1016/j.jmateco.2006.03.001 Byline: Nizar Allouch (a), Cuong Le Van (b), Frank H. Page (c) Keywords: Arbitrage; Asset market equilibrium; Nonsatiation; Recession cones Abstract: In his seminal paper on arbitrage and competitive equilibrium in unbounded exchange economies, Werner (1987) proved the existence of a competitive equilibrium, under a price no-arbitrage condition, without assuming either local or global nonsatiation. Werner's existence result contrasts sharply with classical existence results for bounded exchange economies which require, at minimum, global nonsatiation at rational allocations. Why do unbounded exchange economies admit existence without local or global nonsatiation? This question is the focus of our paper. First, we show that in unbounded exchange economies, even if some agents' preferences are satiated, the absence of arbitrage is sufficient for the existence of competitive equilibria, as long as each agent who is satiated has a nonempty set of useful net trades- that is, as long as agents' preferences satisfy weak nonsatiation. Second, we provide a new approach to proving existence in unbounded exchange economies. The key step in our new approach is to transform the original economy to an economy satisfying global nonsatiation such that all equilibria of the transformed economy are equilibria of the original economy. What our approach makes clear is that it is precisely the condition of weak nonsatiation - a condition considerably weaker than local or global nonsatiation - that makes possible this transformation. Author Affiliation: (a) Department of Economics, Queen Mary, University of London, Mile End Road, E1 4NS London, United Kingdom (b) Centre d'Economie de la Sorbonne, Paris 1 Pantheon-Sorbonne, CNRS, 106-112 Bd de l'HA[acute accent]pital, 75647 Paris, France (c) Department of Finance, University of Alabama, Tuscaloosa, AL 35487, USA Article History: Received 8 March 2006; Accepted 30 March 2006

The study provides a new framework for the analysis of and demonstrates the existence of farsighted consistent directed networks. The framework extends the standard notion of a network and also introduces the notion of a supernetwork.

This model of arbitrage unifies several previous papers and looks at arbitrage under varous allocations and conditions.

A general existence result for a specific Stackelberg revelation game is established to arrive at a standard approach to the problem of existence of optimal auctions for a a wide array of auction environments. When systematically specializing the revelation game to include different types of auctions, the presence of optimal Bayesian auction mechanisms for single and multiple unit auctions and for contract auctions with moral hazard and adverse selection are deduced.

A counterexample to a theorem that states that limited arbitrage is needed and adequate to attain equilibrium in an economy with unbounded short sales is presented. The counterexample indicates that the concept defined by the theorem is not enough for attaining equilibrium and shows that the notion of gains from trade has no significance for the existence of an equilibrium.