A case for incomplete markets

• 成果类型: Article
• 署名作者: Blume, Lawrence E.; Cogley, Timothy; Easley, David A.; Sargent, Thomas J.; Tsyrennikov, Viktor
• 署名单位: Cornell University; New York University
• 刊物名称: JOURNAL OF ECONOMIC THEORY
• ISSN/ISSBN: 0022-0531
• DOI: 10.1016/j.jet.2018.09.004
• 发表日期: 2018
• 页码: 191-221
• 关键词: Social welfare; heterogeneous beliefs; Spurious unanimity; speculation; incomplete markets; Financial regulation

摘要

If two rational agents want to trade and there are no externalities, then trade is Pareto improving. Economists generally oppose restrictions on such trade. Complete markets allocations are Pareto optimal and thus complete markets are generally viewed as good. But when individuals want to trade because of heterogeneous beliefs, this standard argument is less compelling. We illustrate this in a standard general equilibrium setting and explore potential social benefits from restrictions on trade that make markets incomplete. (C) 2018 Elsevier Inc. All rights reserved.