Difference between aggregation and representative agent

Assignment Help Business Economics

Reference no: EM13769417

What is the difference between "aggregation" and a "representative agent?" I'm sorry if I'm not entirely clear on this question, but that's why I ask. It seems to me as if a representative agent is defined as a situation in which a competitive equilibrium can be reached by maximizing the utility of an object that can be interpreted as a "representative agent" whereas "aggregation" refers to a related situation where in competitive equilibrium prices don't depend on the distribution of an initial endowment. (Something to this effect.)

Could somebody clarify what these two concepts are and how they are related and/or different?

Reference no: EM13769417

Questions Cloud

Operations function in the organization structure : Operations are an important management function in an organization. The role of operations management changes as companies react to the business environment.

Analyzing unemployment over the business cycle : The Mortensen-Pissarides (MP) framework of search labor is the thing in analyzing (equilibrium) unemployment over the business cycle. Shimer showed that the lack of hires is the big margin that affects the volatility of labor. Since then people tried..

What kind of economic freeware exists for economics students : Can anyone recommend some free software for students studying economics for use in senior projects, theses, or dissertations? What kind of economic freeware exists for economics students?

In the context of international financial crises : In the context of international financial crises, what mathematical methods have Economists employed in order to quantify financial contagion?

Difference between aggregation and representative agent : What is the difference between "aggregation" and a "representative agent?" I'm sorry if I'm not entirely clear on this question, but that's why I ask. It seems to me as if a representative agent is defined as a situation in which a competitive equili..

Can businesses be an important cause of inflation : Inflation is always and everywhere a monetary phenomenon in the sense that it is and can be produced only by a more rapid increase in the quantity of money than in output. Can businesses be an important cause of inflation or is it a pure monetary eff..

Minimum wage warps the equilibrium point : It is generally accepted among economists that minimum wage warps the equilibrium point between the supply and demand of labor by instituting price floor and increases unemployment for unskilled laborers (while increasing the wage for the individuals..

Long term impacts of government fiscal contractions : Is there much research into the long term impacts of government fiscal contractions. I have heard about 2nd generation unemployed as a result of Thatcher's policies but that is very much anecdotal. What does the literature have to say on the matter?

User Account

All Pages