International stock market equilibrium with heterogeneous tastes
Article Abstract:
The Arrow-Debreu markets model is used to analyze portfolio choice in international trading in commodities and equities in a dynamic and multicommodity setting. Results demonstrate that with heterogeneous countries, general equilibrium considerations can have strong implications for portfolio decisions. One empirical implication is that observed bias against foreign equities tends to short such equities. This tendency is also likely to occur as world capital markets integrate and as costs of international equity transactions decline.
Publication Name: American Economic Review
Subject: Economics
ISSN: 0002-8282
Year: 1999
User Contributions:
Comment about this article or add new information about this topic:
Can rational expectations sticky-price models explain inflation dynamics
Article Abstract:
The use of economic development evaluation models for evaluating inflation scenarios is discussed.
Publication Name: American Economic Review
Subject: Economics
ISSN: 0002-8282
Year: 2006
User Contributions:
Comment about this article or add new information about this topic:
- Abstracts: General equilibrium with endogenously incomplete financial markets. The economics of cultural transmission and the dynamics of preferences
- Abstracts: A quantal response equilibrium model of order-statistic games. An exploration of reputation formation in experimental games
- Abstracts: A quantal response equilibrium model of order-statistic games. part 2 Engineering altruism: a theoretical and experimental investigation of anonymity and gift giving
- Abstracts: The US stock market and the international value of the dollar. Is the US fiscal deficit sustainable? a fractionally integrated approach
- Abstracts: Learning by imitation. Risk sharing through financial markets with endogenous enforcement of trades. Existence of competitive equilibrium under financial constraints and increasing returns