, slumps characterized by unemployment and weak growth. We refer to these episodes as stagnation traps, because they consist in …We provide a Keynesian growth theory in which pessimistic expectations can lead to very persistent, or even permanent … the joint occurrence of a liquidity and a growth trap. In a stagnation trap, the central bank is unable to restore full …

stagnation in steady state, but implies a long run paradox of thrift; and (iii) allows for contextualization vis-à-vis the …