Theoretical Economics, Volume 3, Number 2 (June 2008)

Theoretical Economics 3 (2008), 257–281

Equilibrium concepts in the large-household model

Tao Zhu


This paper formulates equilibrium concepts in the large (non atomic) household model under the team notion, characterizes a class of equilibrium allocations, explores whether an equilibrium allocation in the large-household model is a limit of equilibrium allocations in the finite-household model, and establishes existence of equilibrium allocations generated by generalized Nash bargaining.

Keywords: Search, large household, equilibrium concept, team

JEL classification: D51, E40, E50

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