# Questions tagged [general-equilibrium]

In economics, general equilibrium theory attempts to explain the behavior of supply, demand, and prices in a whole economy with several or many interacting markets, by seeking to prove that the interaction of demand and supply will result in an overall (or "general") equilibrium.

250 questions
Filter by
Sorted by
Tagged with
601 views

### What is equilibrium economics

I was taking a course I complexity economics. My professor told me economics that are taught in say Romer, Blanchard are equilibrium economics. My question is what does he exactly mean by equilibrium ...
• 31
1 vote
69 views

### Taxation in a general equilibrium framework

Is there a good reference on taxation theory in a general equilibrium framework? I am especially interested in the following questions. Is the equilibrium independent of who pays the taxes? Is the ...
• 73
20 views

### Negative externality in consumption to a Cobb Douglas utility function

I am performing a brief analysis with a Computable General Equilibrium Model approach. I want to apply a negative externality in consumption to a Cobb Douglas utility function, any idea to do it and ...
1 vote
24 views

### Derivation total demand using Roy's identity

I have a "resource-balance" equation of the form (imports in sector $i$) = (number of $i$ demanded domestically) - (number of good $i$ supplied domestically). I can't figure out how the ...
32 views

### What is the intuition behind this full-employment condition?

I am given the following full-employment condition, where sectors of the economy are indexed by $i$. $L+\sum_i\frac{\partial \pi_i(p_i,w)}{\partial w}=0$ Why, if all workers are employed, should how ...
1 vote
46 views

In their book "Radical Markets", the authors (Posner and Weyl) suggest a market for votes, where citizens can freely buy and sell their votes. But there is a catch: in order to have $k$ ...
• 3,105
28 views

### How to find the amount of leisure time and the good consumed in a two-person and one-good economy?

Question: Suppose an economy consists of two price-taking people, “a” and “b.” Person a has available 1 unit of “time” which he divides between rest $R(a)$ and labour $L(a)$. Person b has available 1 ...
• 25
1 vote
146 views

### Competitive equilibrium in a two-person economy with substitutes and complements

Recently came across this question on a microeconomics test and there was something that did not sit quite right with me. In an economy with two agents, A and B, and two goods, milk and honey, the ...
1 vote
46 views

### Introducing productive sector into an exchange economy where only one agent is endowed with input

I'm trying to find a competitive equilibrium for an economy with consumers and some outside productive sector. Consider an economy with two consumption goods $x_1, x_2$ and two individuals $A,B$ . ...
1 vote
146 views

### Can we define the core as the intersection of Pareto efficient allocations and upper-contour sets?

Suppose that an economy has $n$ agents, each with endowment $\omega_i$. Their preferences are represented by the quasiconcave and increasing function $u_i$. Let the set of Pareto efficient allocations ...
153 views

### Find the competitive equilibrium of the following economy

The following question was given as a part of a task in microeconomic theory course. It is not from some textbook and since I still haven't figured a way to solve it I will leave it here. Thank you in ...
• 420
1 vote
778 views

### Is the supply and demand elasticity equal at the equilibrium?

I am working through homeowrk problems and we were asked to calculate the supply and demand at the equilibruim using either the point or arc method. I chose to use the point method and will provide a ...
• 31
17 views

### How does Perfectly Competitive Output Level Compare to Cournot Output Level

So Let there be two firms with Output Level x1 and x2 .Inverse Demand Function $P=a-bX$ where $X=x1+x2$.Both firms have same MC denoted by $c$. Is the Perfectly Competitive O/t > Cournot O/t ...
• 3
436 views

### Robinson Crusoe with tax

This question was asked in a micro exam last semester and I just dont know the answer, have been thinking about it for weeks. Please help. In a Robinson Cruse Economy Robinson produces Coconuts (C) ...
• 27