Introduction
- Specialize the abstract Arrow-Debreu model to interpret it as trading under uncertainty.
- Interpret commodities, preferences, endowments, budget sets, etc., to apply to situations with uncertainy.
- Examine alternative market specifications.
What questions do we want to ask in these models?
- Comparative statics of preference parameters — risk, ambiguity aversion.
- Welfare properties of markets.
- The structure of equilibrium — the composition of prices.
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