Sunspots and Business Cycle in a Finance Constrained Economy

J.P. Barinci and Arnaud Cheron ()

Papiers d'Economie Mathématique et Applications from Université Panthéon-Sorbonne (Paris 1)

Abstract: This paper examines the cyclical properties of a finance constrained economy populated by two classes of households with heterogeneous preferences and featuring social increasing returns-to-scale. The model exhibits indeterminacy for externalities mild enough so that the labor demand curve is downward sloping. Furthermore, simulation results show that endogenous fluctuations driven by expectations are quantitatively relevant.

Keywords: BUSINESS; CYCLES (search for similar items in EconPapers)
JEL-codes: E10 E30 E32 (search for similar items in EconPapers)
Date: 2000

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Persistent link: http://EconPapers.repec.org/RePEc:fth:pariem:2000.10

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