Abstract
In this chapter a price and quantity adjustment process is described to obtain a Walrasian equilibrium in the economy. At a Walrasian equilibrium price system the supply is equal to the demand for every commodity. For an arbitrary price system it holds that the total excess demand for some commodities is negative, while for other commodities it is positive. A Drèze equilibrium can then be obtained by rationing in the markets for the non-numeraire commodities.
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© 1996 Springer Science+Business Media New York
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Herings, P.JJ. (1996). Equilibrium Adjustment of Disequilibrium Prices. In: Static and Dynamic Aspects of General Disequilibrium Theory. Theory and Decision Library, vol 13. Springer, Boston, MA. https://doi.org/10.1007/978-1-4615-6251-1_12
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DOI: https://doi.org/10.1007/978-1-4615-6251-1_12
Publisher Name: Springer, Boston, MA
Print ISBN: 978-1-4613-7868-6
Online ISBN: 978-1-4615-6251-1
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