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Kinky perceived demand curves and Keynes–Negishi equilibria

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  • Jacques H. Drèze
  • P. Jean‐Jacques Herings

Abstract

The label “Keynes–Negishi equilibria” is attached here to equilibria in a monetary economy with imperfectly competitive product and labor markets where business firms and labor unions hold demand perceptions with kinks: as posited in Negishi's 1979 book Microeconomic Foundations of Keynesian Macroeconomics. Such equilibria are defined in a general equilibrium model, and shown to exist. Methodological implications are briefly discussed in a concluding section.

Suggested Citation

  • Jacques H. Drèze & P. Jean‐Jacques Herings, 2008. "Kinky perceived demand curves and Keynes–Negishi equilibria," International Journal of Economic Theory, The International Society for Economic Theory, vol. 4(2), pages 207-246, June.
    • Handle: RePEc:bla:ijethy:v:4:y:2008:i:2:p:207-246
    DOI: 10.1111/j.1742-7363.2008.00072.x
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    Cited by:

    1. Hiroshi Yoshikawa, 2011. "Stochastic Macro-equilibrium and A Microfoundation for the Keynesian Economics," CIRJE F-Series CIRJE-F-827, CIRJE, Faculty of Economics, University of Tokyo.

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    More about this item

    JEL classification:

    • D50 - Microeconomics - - General Equilibrium and Disequilibrium - - - General
    • E12 - Macroeconomics and Monetary Economics - - General Aggregative Models - - - Keynes; Keynesian; Post-Keynesian; Modern Monetary Theory
    • J51 - Labor and Demographic Economics - - Labor-Management Relations, Trade Unions, and Collective Bargaining - - - Trade Unions: Objectives, Structure, and Effects

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