Dong, J.; Zhang, D.; Nagurney, A. A projected dynamical systems model of general financial equilibrium with stability analysis. (English) Zbl 0858.90020 Math. Comput. Modelling 24, No. 2, 35-44 (1996). Summary: We present a dynamic model of general financial equilibrium. The model assumes utility-maximizing sectors in the economy that take the prices of the financial instruments as given. The economy, in turn, determines prices of the instruments that balance the supplies and demands. The financial adjustment process is shown to satisfy a projected dynamical system. This methodology is then used to establish, under certain conditions on the utility functions, both the stability and the asymptotical stability of the equilibrium asset, liability, and price pattern. This approach unveils a dynamic approach to competitive equilibrium problems that have, heretofore, been studied, principally, in the static framework of finite-dimensional variational inequality theory. Cited in 24 Documents MSC: 91B62 Economic growth models 91B50 General equilibrium theory 91B52 Special types of economic equilibria 91G80 Financial applications of other theories Keywords:general financial equilibrium; projected dynamical system; asymptotical stability; variational inequality PDF BibTeX XML Cite \textit{J. Dong} et al., Math. Comput. Modelling 24, No. 2, 35--44 (1996; Zbl 0858.90020) Full Text: DOI OpenURL References: [1] Dupuis, P.; Nagurney, A., Dynamical systems and variational inequalities, Annals of operations research, 44, 9-42, (1993) · Zbl 0785.93044 [2] Zhang, D.; Nagurney, A., On the stability of projected dynamical systems, Journal of optimization theory and applications, 85, 97-124, (1995) · Zbl 0837.93063 [3] Nagurney, A., Network economics: A variational inequality approach, (1993), Kluwer Academic Publishers Boston, MA · Zbl 0873.90015 [4] Nagurney, A., Variational inequalities in the analysis and computation of general financial equilibrium, Journal of economic dynamics and control, 85, 161-184, (1994) · Zbl 0788.90011 [5] Smale, S., Dynamics in general equilibrium theory, American economic review, 66, 288-294, (1976) [6] Smale, S., A convergence process of price adjustment and global Newton methods, Journal of mathematical economics, 3, 107-120, (1976) · Zbl 0354.90018 [7] Markowitz, H.M., Portfolio selection, The journal of finance, 77-91, (1952) [8] Markowitz, H.M., Portfolio selection: efficient diversification of investments, (1959), John Wiley New York [9] Sharpe, W.F., Portfolio theory and capital markets, (1970), McGraw-Hill New York [10] Dong, J., General financial equilibrium with policy interventions: A variational inequality approach, Annals of operations research, 44, 227-241, (1993) · Zbl 0782.90007 This reference list is based on information provided by the publisher or from digital mathematics libraries. Its items are heuristically matched to zbMATH identifiers and may contain data conversion errors. It attempts to reflect the references listed in the original paper as accurately as possible without claiming the completeness or perfect precision of the matching.