Review of Economic Design

, Volume 6, Issue 2, pp 133–153 | Cite as

On characterizing the probability of survival in a large competitive economy

  • Rabi N. Bhattacharya
  • Mukul Majumdar
Original papers


We consider a Walrasian exchange economy in which an agent is characterized by a utility function, a random endowment vector, and a function that specifies the minimum expenditure necessary for survival at a given price system. If at any equilibrium price system, the income of the agent is no more than the minimum expenditure for survival, it is ruined. The main results characterize the probability of ruin when the number of agents is large. The implications of stochastic dependence among agents are explored.


Utility Function Equilibrium Price Exchange Economy Price System Minimum Expenditure 
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Copyright information

© Springer-Verlag Berlin Heidelberg 2001

Authors and Affiliations

  • Rabi N. Bhattacharya
    • 1
  • Mukul Majumdar
    • 2
  1. 1.Department of Mathematics, Indiana University, Rawles Hall, Bloomington, IN 47405, USA(e-mail: US
  2. 2.Department of Economics, Cornell University, Uris Hall 460, Ithaca, NY 14853-7601, USA(e-mail: US

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