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On the macroeconomics of uncertainty and incomplete markets

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  • DREZE, Jacques

    ()
    (Center for Operations Research and Econometrics (CORE), Université catholique de Louvain (UCL), Louvain la Neuve, Belgium)

Abstract

Presidential address for the Twelfth World Congress of the International Economic Association, summarising semi-formally the author’s recent work and concerns. Uncertainty and incomplete markets breed demand volatility as well as price and wage rigidities. The conjunction of these leads to multiple, volatile supply-constrained equilibria, typically reflecting coordination failures and apt to display persistence - as documented by three supporting theorems. Specific implications are linked to the conclusions that we should take coordination failures seriously, try to obviate demand volatility and try to bypass price and wage rigidities.

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Bibliographic Info

Paper provided by Université catholique de Louvain, Center for Operations Research and Econometrics (CORE) in its series CORE Discussion Papers with number 1999064.

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Date of creation: 01 Nov 1999
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Handle: RePEc:cor:louvco:1999064

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References

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Citations

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Cited by:
  1. Herings, P.J.J. & Laan, G. van der & Talman, A.J.J., 2001. "Quantity Constrained Equilibria," Discussion Paper 2001-93, Tilburg University, Center for Economic Research.
  2. Hoog S. van der, 2005. "On the Micro-Dynamics of a Cash-in-Advance Economy (revised version of WP 04-12)," CeNDEF Working Papers 05-04, Universiteit van Amsterdam, Center for Nonlinear Dynamics in Economics and Finance.
  3. DREZE, Jacques H. & HERINGS, Jean-Jacques P., . "Kinky perceived demand curves and Keynes-Negishi equilibria," CORE Discussion Papers RP -2035, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
  4. Sander van der Hoog, 2004. "Credit and Cash-in-Advance in Disequilibrium Models," Computing in Economics and Finance 2004 294, Society for Computational Economics.
  5. E. Abdul Azeez, 2002. "Economic reforms and industrial performance: An analysis of capacity utilisation in Indian manufacturing," Centre for Development Studies, Trivendrum Working Papers 334, Centre for Development Studies, Trivendrum, India.
  6. Olivier SCAILLET, 2001. "Density Estimation Using Inverse and Reciprocal Inverse Guassian Kernels," Discussion Papers (IRES - Institut de Recherches Economiques et Sociales) 2001017, Université catholique de Louvain, Institut de Recherches Economiques et Sociales (IRES).
  7. Fagnart, Jean-François & Sneessens, Henri, 2001. "Microeconomic Uncertainty and Macroeconomic Indeterminacy," Discussion Papers (IRES - Institut de Recherches Economiques et Sociales) 2001007, Université catholique de Louvain, Institut de Recherches Economiques et Sociales (IRES).
  8. Herings, P.J.J. & Laan, G. van der & Talman, A.J.J., 2004. "Equilibria with Coordination Failures," Discussion Paper 2004-107, Tilburg University, Center for Economic Research.
  9. Citanna, Alessandro & Cres, Herve & Dreze, Jacques & Herings, P. Jean-Jacques & Villanacci, Antonio, 2001. "Continua of underemployment equilibria reflecting coordination failures, also at Walrasian prices," Journal of Mathematical Economics, Elsevier, vol. 36(3), pages 169-200, December.
  10. Gerald Stuber, 2001. "Implications of Uncertainty about Long-Run Inflation and the Price Level," Working Papers 01-16, Bank of Canada.

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