Abstract
The standard model of regular exchange economies assumes monotone preferences (“more is always better”), which then assures that only positive prices need to be considered. Trout Rader (1972) has introduced a general equilibrium model where negative prices are allowed, and has provided a proof of existence of equilibrium.1 In the current paper we consider a version of Rader’s model simplified to exchange economies, and explore the results possible when regularity conditions are introduced. While static results on the number of equilibria are considered, emphasis is also given to a dynamic interpretation of the model. It is found that most static results from the standard model transfer appropriately to the current model. This process of transfer may also be reversed, however. The simplicity of the current model permits new results to be derived with minimal complications. The derivations then suggest whether the results may be extended back to the standard model. An example of this process is given in the context of comparative statics.
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