scientific article; zbMATH DE number 1154011
This chapter from the Handbook represents a review of issues devoted to the investigation of the existence problem of the general economic equilibrium of special type in economics essentially different from the idealized Arrow-Debreu ones. Also investigations of the structure of the equilibria set are involved. The main results on the problems are presented with proofs of the authors' version. The concept of sunspot equilibrium imbedded in the theory of rational expectations. Naturally ``sunspot equilibrium means multiplicity and indeterminacy of such states of economy. It arises in dynamic sequential market models when agents' forecast of future market state (one step forward) is not perfect, temporal markets have varied incomplete structure, the horizon is infinite. The basic abstract model under consideration is the mapping \(\tilde Z\) acting from the product of some closed subset \(X\) of \(\mathbb{R}^n\) (phase space) and the set \(\mathcal P (X)\) of probability measures to \(\mathbb{R}^n\). This mapping is a generalization of the excess demand one. A sequence of temporary equilibria is a sequence of states \(x_t\) and measure expectations \(\mu_{t+1}\in \mathcal P (X)\) such that \(\tilde Z(x_t, \mu_{t+1})=0\). The sunspot equilibrium (SE) is defined as a Markov process on a non-trivial subset \(X_0 \subset X\) with a transition function \(\tilde \mu\) (defined on the product of \(X_0\) and the Borel field of \(X_0\)) such that for each \(x \in X_0\) and \(\mu_x = \) \(\tilde \mu (x, \cdot)\) the equation \(\tilde Z(x, \mu_{x})=0\) holds. Some SE existence and its structure results are presented in this review. They are based on different analytic techniques. These are invariant set argument, bifurcation of vector field, implicit function theorem, dynamical systems, differential topology (Poincaré-Hopf theorem). Extensions of the basic model involving problems of agents' learning and dependence on a process memory are considered as well. For the entire collection see [Zbl 0889.90001].
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