Bénassy, Jean-Pascal - 1999 - Revised June 1998
rational expectations. The economy is a monetary one with preset wages, and is subject to both demand and supply shocks. It is … assumed that the government can never act on the basis of information superior to that of the private sector. Morecover wages … countercyclical one. It has the remarkable property that, although the economy is hit each period by stochastic shocks after wages …
