The New Palgrave Dictionary of Economics

2018 Edition
| Editors: Macmillan Publishers Ltd

Comparative Statics

  • John Nachbar
Reference work entry
DOI: https://doi.org/10.1057/978-1-349-95189-5_322

Abstract

Comparative statics in competitive general equilibrium (GE) environments provide insight into the operation of GE models and a means to confront GE models with data. This article focuses on a canonical comparative statics prediction: in an exchange economy, aggregate endowment changes are negatively related to equilibrium price changes. In particular, an increase in the aggregate endowment of a commodity lowers its equilibrium price.

Keywords

Aggregate excess demand Asset pricing Comparative statics Competitive general equilibrium Debreu–Mantel–Sonnenschein theorem Demand shocks Endowment changes General equilibrium Gross substitutes Hicks, J. Partial equilibrium Production economies Rybcyznski theorem Stolper–Samuelson theorem Supply shocks Weak axiom of revealed preference 

JEL Classifications

C6 
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Copyright information

© Macmillan Publishers Ltd. 2018

Authors and Affiliations

  • John Nachbar
    • 1
  1. 1.