If you need an accessible version of this item please contact JSTOR User Support

Aggregate Demand Management in Search Equilibrium

Peter A. Diamond
Journal of Political Economy
Vol. 90, No. 5 (Oct., 1982), pp. 881-894
Stable URL: http://www.jstor.org/stable/1837124
Page Count: 14
  • Download PDF
  • Cite this Item

You are not currently logged in.

Access your personal account or get JSTOR access through your library or other institution:

login

Log in to your personal account or through your institution.

If you need an accessible version of this item please contact JSTOR User Support
Aggregate Demand Management in Search Equilibrium
Preview not available

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.

Page Thumbnails

  • Thumbnail: Page 
881
    881
  • Thumbnail: Page 
882
    882
  • Thumbnail: Page 
883
    883
  • Thumbnail: Page 
884
    884
  • Thumbnail: Page 
885
    885
  • Thumbnail: Page 
886
    886
  • Thumbnail: Page 
887
    887
  • Thumbnail: Page 
888
    888
  • Thumbnail: Page 
889
    889
  • Thumbnail: Page 
890
    890
  • Thumbnail: Page 
891
    891
  • Thumbnail: Page 
892
    892
  • Thumbnail: Page 
893
    893
  • Thumbnail: Page 
894
    894