The survival assumption and existence of competitive equilibria when asset markets are incomplete

The paper studies the role and the formulation of the survival assumption with incomplete markets. We are able to show the existence of a competitive equilibrium when the agents' endowments lie on the boundary of their consumption set However, for this some additional assumptions with respect to the complete market case are needed. These are joint restrictions on the asset structure and the distribution of the endowments and preferences. (C) 1996 Academic Press, Inc.