Klaus Ritzberger, Royal Holloway, University of London

Campus WU Vienna D3.0.225 11:00 - 12:15

Organizer VGSF

As part of the series of the „Finance Research Seminar“, VGSF welcomes Klaus Ritzberger from Royal Holloway, University of London to present his research paper.
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Bankruptcy in General Equilibrium with Uncertainty

In a general equilibrium model with time and uncertainty the possibility of bankruptcy cannot be excluded in general, when short sale constraints are too loose. Tight short trading constraints, on the other hand, are inefficient. Bankruptcies turn security payoffs endogenous and destroy convexity of the induced preferences over portfolios. The latter raises existence issues for competitive equilibrium.

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