Instability and indeterminacy in a simple search and matching model

We demonstrate the possibility of indeterminacy and non-existence of equilibrium dynamics in a standard business cycle model with search and matching frictions in the labor market. Our results arise for empirically plausible parametrizations and do not rely upon a mechanism such as increasing returns.

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Year of publication:	2010
Authors:	Krause, Michael ; Lubik, Thomas A.
Institutions:	Deutsche Bundesbank
Subject:	search and matching \| indeterminacy \| match elasticity

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Extent:	application/pdf
Series:	Discussion Paper Series 1: Economic Studies.
Type of publication:	Book / Working Paper
Language:	English
Notes:	Number 2010,25
Classification:	E24 - Employment; Unemployment; Wages ; E32 - Business Fluctuations; Cycles ; J64 - Unemployment: Models, Duration, Incidence, and Job Search
Source:	RePEc - Research Papers in Economics

Persistent link: https://www.econbiz.de/10008804630