Journal of Political Economy Vol. 90 No. 5 1982
Aggregate Demand Management in Search Equilibrium
Abstract
Equilibrium is analyzed for a simple barter model with identical risk-neutral agents where trade is coordinated by a stochastic matching process. It is shown that there are multiple steady-state rational expectations equilibria, with all non-corner solution equilibria inefficient. This implies that an economy with this type of trade friction does not have a unique natural rate of unemployment.
- DOI
- 10.1086/261099
- Volume
- 90
- Issue
- 5
- Pages
- 881-894
- Language
- en
- Sources
- openalex crossref