A "classical" general equilibrium model
Year of publication: 1991
Issue: 11
Pages: 1-38
Type: Working paper
Abstract
It is shown in this paper how for any parametrically given rate of profits p, a price vector and an allocation exist such that: (a) Consumers maximize their preferences subject to their budget constraints; (b) Firms maximize profits; (c) Al1 active firms are equally profitable (with a rate of return equal to p); and (d) All markets clear.