restore the efficiency of equilibria. -- illiquid markets ; default ; incomplete markets ; price distortions ; inefficient …

production economies with incomplete markets. Constrained efficiency cannot serve as a basis for such an extension because … multiperiod models tend to violate even weak constrained efficiency requirements. We show by means of examples how the … efficiency, which has been introduced by Dierker et al. (2005) in a two-period model, to derive a natural extension of the Drèze …