If agents are ambiguity-averse and can invest in productive assets, asset prices can robustly exhibit indeterminacy in the markets that open after the productive investment has been launched. For indeterminacy to occur, the aggregate supply of goods must appear in precise configurations but the...

In this paper, the author shows how the introduction of a bargaining game structure into a standard R&D endogenous growth model can be a potential source of local indeterminacy. He also shows that on a high-growth path, the government, by directly engaging in R&D activities and using R&D...