implausibly large and rise quickly with the relative risk aversion in labor. We show that unsynchronized wage adjustment via a … level and make it invariant to the relative risk aversion in labor. As a result, indeterminacy and sunspot-driven business … aversion in labor. The impulse responses of our model to demand shocks under indeterminacy are reasonable in terms of matching …

generating indeterminacy can be implausibly large and rise quickly with the relative risk aversion in labor. We show that … to a plausible level and make it invariant to the relative risk aversion in labor. Consequently, indeterminacy and … sunspot-driven fluctuations can emerge for plausible increasing returns regardless of the relative risk aversion in labor. Our …