The Computation of a Continuum of Constrained Equilibria

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Abstract
The equilibria of a model of an exchange economy with price rigidities are called constrained equilibria. A simplicial algorithm on the unit cube is proposed to compute an approximation of a continuum of zero points of the excess demand correspondence of such an economy. This continuum of zero points corresponds to a continuum of constrained equilibria of the economy, linking the two so-called trivial equilibria. Moreover, the convergence properties of the algorithm and the accuracy of the approximate constrained equilibria obtained by the algorithm are discussed. Finally, an example is given as an illustration.

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