This paper introduces efficiency wages designed to provide workers withincentives to make appropriate effort levels, and involuntary unemployment,along the pioneering lines of Negishi (1979), Solow (1979), Shapiro andStiglitz (1984), in a dynamic model involving heterogeneous agents and...

This is the revised entry “Temporary equilibrium”, forthcoming in the newedition of The New Palgrave, Lawrence Blume and Steve Durlaub (Eds.), PalgraveMc Millan, 2007. The entry surveys the developments of temporary generalequilibrium theory and its contributions to a better understanding of...

We propose a method to aggregate heterogeneous individual beliefs, givena competitive equilibrium in complete asset markets, into a single “marketprobability” such that it generates, if commonly shared by all investors, thesame marginal valuation of assets by the market (the same equilibrium...

The aim of these lecture notes is to present a few mathematical factsabout the bifurcations of nonlinear difference equations, in a concise andsimple form that might be useable by economic theorists.