Title

Nash and Walras Equilibrium via Brouwer

Document Type

Discussion Paper

Publication Date

8-1-1996

CFDP Number

1131R3

CFDP Revision Date

2002-02-01

CFDP Pages

20

Abstract

The existence of Nash and Walras equilibrium is proved via Brouwer’s Fixed Point Theorem, without recourse to Kakutani’s Fixed Point Theorem for correspondences. The domain of the Walras fixed point map is confined to the price simplex, even when there is production and weakly quasi-convex preferences. The key idea is to replace optimization with “satisficing improvement,” i.e., to replace the Maximum Principle with the “Satisficing Principle.”

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