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Continuous-Time Asset Pricing Theory pp 275–306Cite as

A Representative Trader Economy

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Abstract

To characterize the equilibrium and to facilitate existence proofs, this chapter introduces the notion of a representative trader. A representative trader is a hypothetical individual whose trades, in a sense to be made precise below, reflect the aggregate trades of all individuals in the economy. A representative trader is defined by her beliefs, utility function, and endowments.

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Authors and Affiliations

  1. Samuel Curtis Johnson Graduate School, Cornell University, Ithaca, New York, USA

    Robert A. Jarrow

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  1. Robert A. Jarrow
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Jarrow, R.A. (2018). A Representative Trader Economy. In: Continuous-Time Asset Pricing Theory. Springer Finance(). Springer, Cham. https://doi.org/10.1007/978-3-319-77821-1_14

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