Stationary sunspot equilibria in a finance constrained economy (Q1082234)
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scientific article
| Language | Label | Description | Also known as |
|---|---|---|---|
| English | Stationary sunspot equilibria in a finance constrained economy |
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Stationary sunspot equilibria in a finance constrained economy (English)
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1986
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Stationary sunspot equilibria are shown to exist in a production economy with infinite lived agents, when it is not possible to borrow against future wage income. Equilibrium fluctuations exhibit persistence over time scales of the same order of magnitude as observed ''business cycles''. An active fiscal policy that stabilizes aggregate money expenditures can prevent such fluctuations.
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Stationary sunspot equilibria
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production economy
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infinite lived agents
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active fiscal policy
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