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Published online by Cambridge University Press:  09 May 2007

CNR/INFM-SMC and Dipartimento di Fisica Università di Roma “La Sapienza”
Abdus Salam International Centre for Theoretical Physics
Instituut voor Theoretische Fysica, Katholieke Universiteit Leuven


We study the competitive equilibrium of large random economies with linear activities using methods of statistical mechanics. We focus on economies with C commodities, N firms, each running a randomly drawn linear technology, and one consumer. We derive, in the limit N, C ∞ with n=N/C fixed, a complete description of the statistical properties of typical equilibria. We find two regimes, which in the limit of efficient technologies are separated by a phase transition, and argue that endogenous technological change drives the economy close to the critical point.

© 2007 Cambridge University Press

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