Multiple unemployment equilibria under non-representative agent demand [electronic resource]
- Arthur J. Chiang.
- Physical description
- 1 online resource.
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- ["This dissertation analyzes the possibility that high unemployment can be be self-reinforcing through its effects on the distribution of income and, consequently, aggregate demand. The major results of my work demonstrate that these forces can lead to multiple macroeconomic equilibria which are indexed by the level of unemployment. By characterizing low output and employment states as equilibrium outcomes, this thesis provides a coherent theoretical explanation for periods of persistently high unemployment. The key property throughout is non-homotheticity of consumers' preferences, whereby the market demand for goods changes as income distribution changes, even if the total income of all consumers remains fixed. This implies that, unlike in many macroeconomic models, demand cannot be generated from a representative agent and, crucially, that changes in employment along the extensive, as opposed to intensive, margin can have more severe general equilibrium consequences."]
- Publication date
- Submitted to the Graduate School of Business.
- Thesis (Ph.D.)--Stanford University, 2011.
- Related Work
- Stanford University. Graduate School of Business. Dissertation. 2011.
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