The degree of indeterminacy of equilibria with incomplete markets

This paper investigates generically the indeterminacy property of a financial equilibrium set with incomplete nominal asset markets in both endowments and utility functions. A permissible utility function is not required to have any convexity, so that the resulting equilibrium set is intuitively expected to become very large. It is, however, proved that generically the degree of indeterminacy of equilibria does not exceed the deficiency in financial asset markets. It is also demonstrated that there is a functional relationship between financial equilibria and an economy parameter.