Existence and multiplicity of temporary equilibria under nominal price rigidities | Zendy

Jacques Drèze | Zendy

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Existence and multiplicity of temporary equilibria under nominal price rigidities

Author(s) -

Jacques Drèze

Publication year - 2015

Publication title -

economic theory

Language(s) - English

Resource type - Journals

SCImago Journal Rank - 1.572

H-Index - 58

eISSN - 1432-0479

pISSN - 0938-2259

DOI - 10.1007/s00199-015-0898-3

Subject(s) - economics , stagflation , phillips curve , multiplicity (mathematics) , unemployment , keynesian economics , inflation (cosmology) , mathematical economics , econometrics , macroeconomics , mathematics , physics , mathematical analysis , theoretical physics

This paper proves existence of a multiplicity of equilibria in a two-period TGE model with money and nominal rigidities. Households have incomplete preferences and firms reach decisions through the “control principle”. The multiple equilibria belong to an inflation–unemployment locus allowing for a Phillips curve or stagflation.

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