Bankruptcy in General Equilibrium

descriptionPublicationkeyboard_double_arrow_right Article , Preprint 01 Jan 2000 English Publisher:Elsevier BVJournal:SSRN Electronic Journal (eissn: 1556-5068,

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Authors: Tarun Sabarwal;

doi: 10.2139/ssrn.249296 , 10.17016/feds.2000.48 , 10.2139/ssrn.3367875

Bankruptcy in General Equilibrium

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Abstract

In this paper, I construct a model of an exchange economy in which bankruptcy arises in a manner similar to what we observe. This model is a more realistic representation of some markets in which intertemporal assets are traded. Using standard and natural assumptions, I show that every economy represented by this model has an equilibrium. Using examples, I highlight some welfare effects of bankruptcy.

Related Organizations

University of Kansas
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Federal Reserve Board of Governors
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Federal Reserve
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Keywords

Bankruptcy ; Econometric models

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