Heterogenous Agents and Incomplete Markets : An Exploration

Josheski, Dushko and Miteva, Natasha and Boskov, Tatjana (2022) Heterogenous Agents and Incomplete Markets : An Exploration. International Journal of Economics, Management and Tourism, 2 (2). pp. 7-25. ISSN 2671-3810

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Abstract

This paper will review the issue of heterogeneity of agents and incomplete markets in macroeconomics. Central idea of this paper is the notion that representative agent models were wrong turn for modern macroeconomics especially for general equilibrium model (some individuals are some are not liquidity constrained) and that central problems of macroeconomics cannot arise in representative agent models (debt, bankruptcy, asymmetric information) as has also being criticized by Stiglitz (2017). And finally main motivation for this paper were Achdou et al.(2022) who developed algorithm for “solving equilibria in Aiyagari–Bewley–Huggett economy” and Krusell-Smith (1998) comparison of economy behavior when incomplete markets (heterogeneous agents) and complete markets (representative agent) economy.

Item Type:	Article
Subjects:	Social Sciences > Economics and business
Divisions:	Faculty of Tourism and Business Logistics
Depositing User:	Dusko Josevski
Date Deposited:	02 Feb 2023 09:50
Last Modified:	02 Feb 2023 09:50
URI:	https://eprints.ugd.edu.mk/id/eprint/31222

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