Market equilibrium prices prove global stability in diverse economies.
The article explores how prices work in an economy with indivisibilities, focusing on whether a price system can function without a specific type of equilibrium. By studying price adjustment processes, the researchers found that in economies with or without this equilibrium, prices eventually stabilize in a unique way. Surprisingly, even in economies without the equilibrium, prices reach a stable point that aligns with market equilibrium prices. This suggests that market equilibrium prices are robust and reliable indicators of stability in various economic scenarios.