Voting in assemblies of shareholders and incomplete markets

Mich Tvede, Hervé Crès

Research output: Contribution to journalArticlepeer-review


An economy with two dates is considered, one state at the first date and a finite number of states at the last date. Shareholders determine production plans by voting - one share, one vote - and at ρ-majority stable stock market equilibria, alternative production plans are supported by at most ρ x 100 percent of the shareholders. It is shown that a ρ-majority stable stock market equilibrium exists if ρ ≥ S - J/S - J + 1, where S is the number of states at the last date and J is the number of firms. Moreover, an example shows that ρ-majority stable stock market equilibria need not exist for smaller ρ's.

Original languageEnglish (US)
Pages (from-to)887-906
Number of pages20
JournalEconomic Theory
Issue number4
StatePublished - Nov 2005


  • General equilibrium
  • Incomplete markets
  • Production
  • Shareholders' voting
  • Super majority

ASJC Scopus subject areas

  • Economics and Econometrics


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