Econometrica: May 1974, Volume 42, Issue 3

The Hahn Process with Firms but No Production

https://doi.org/0012-9682(197405)42:3<471:THPWFB>2.0.CO;2-G
p. 471-486

Franklin M. Fisher

The earlier results of Hahn and Negishi [4] and Arrow and Hahn [1] on non-tatonnement in pure exchange are extended to the production case. However, just as in pure exchange, consumption does not take place until equilibrium is reached; in the present paper production is also delayed until that date. The result that the sum of target utilities of households can be taken to be a Lyapounov function is preserved; reduction in target utilities comes about partly as a consequence of reduction in target profits expected by firms out of equilibrium.

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