Elsevier

Journal of Economic Theory

Volume 144, Issue 6, November 2009, Pages 2440-2453
Journal of Economic Theory

Anonymity and individual risk

https://doi.org/10.1016/j.jet.2009.05.009Get rights and content

Abstract

Adverse selection economies with private information are generally studied under the assumption that contracts are exclusive. That is, retrading is prohibited. An alternative market mechanism, the anonymous mechanism, is studied here. Risk averse agents trade contingent claims directly and side markets are in equilibrium. The result is the anonymous equilibrium. The anonymous equilibrium results in a set of endogenous transfers and subsidies.

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Cited by (2)

1

I would like to thank the associate editor, Sumit Joshi, Roger Lagunoff, Robert Lucas, and the participants of the Macroeconomics Workshop at Georgetown University, George Washington University, and the Texas Monetary Conference for helpful comments on an earlier draft.

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