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Determinacy with capital adjustment costs and sector-specific externalities

Herrendorf, Berthold; Valentinyi, Ákos - 2000

indeterminate and stable sunspots are possible. We find that capital adjustment costs of any size preclude stable sunspots for every … size are considered, a necessary condition for the existence of stable sunspots is an upward- sloping labor demand curve in … the standard result that when we abstract from capital adjustment costs, stable sunspots occur in the two-sector model for …

Persistent link: https://www.econbiz.de/10011545467

Welfare and excess volatility of exchange rates

Salto, Matteo; Pietra, Tito - 2011 - Version: June 10, 2011

We study the properties of a GEI model with nominal assets, outside money (injected into the economy as in Magill and Quinzii), and multiple currencies. We analyze the existence of monetary equilibria and the structure of the equilibrium set under two different assumptions on the determination...

Persistent link: https://www.econbiz.de/10011735010

Liquid equity and boom-bust dynamics

Buggenum, Hugo van - 2024

I develop and analyze a monetary model with liquid equity. Equity is a claim on the profits of firms acting as sellers in the search-and-matching market. Buyers in that market devote search to obtain matches with firms, and use the equity to relax a liquidity constraint. The dual nature of...

Persistent link: https://www.econbiz.de/10014633356

Currency crisis, sunspots and Markov-switching regimes

Jeanne, Olivier; Masson, Paul - 1998

Persistent link: https://www.econbiz.de/10000680182

Indeterminacy in a forward-looking regime-switching model

Farmer, Roger E. A. (contributor); … - 2007 - Rev.

This paper is about the properties of Markov-switching rational expectations (MSRE) models. We discuss possible solution concepts for MSRE models, distinguishing between stationary and bounded equilibria. For the case of models with one variable, we provide a necessary and sufficient condition...