Testable Restrictions on the Equilibrium Manifold

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Published in RePEc

Abstract

We present a finite system of polynomial inequalities in unobservable variables and market data that observations on market prices, individual incomes and aggregate endowments must satisfy to be consistent with the equilibrium behavior of some pure trade economy. Quantifier elimination is used to derive testable propositions on finite data sets for the pure trade model.

Keywords

TESTABLE RESTRICTIONS
EQUILIBRIUM MANIFOLD
EQUILIBRIUM BEHAVIOR
FINITE SYSTEM
PROPOSITIONS
PURE TRADE
MANIFOLD
MARKET

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