Externalities, consumption constraints and regular economies

Jean-Marc Bonnisseau (1, 2) , Elena L. del Mercato (1, 2)

1 CES - Centre d'économie de la Sorbonne
2 PSE - Paris School of Economics

We consider a general model of pure exchange economies with consumption externalities. Households may have different consumption sets and each consumption set is described by a function called the possibility function. Utility and possibility functions depend on the consumptions of all households. Showing by means of an example that basic assumptions are not enough to guarantee generic regularity, we provide sufficient conditions for generic regularity in the space of endowments and possibility functions.

Mots clés: Externalities; Consumption constraints; Competitive equilibrium; Regular economies

Domaines: Economies et finances; Méthodes et statistiques

Jean-Marc Bonnisseau, Elena L. del Mercato. Externalities, consumption constraints and regular economies. Economic Theory, 2010, 44 (1), pp.123-147. ⟨10.1007/s00199-009-0464-y⟩. ⟨halshs-00381637⟩