Effective Demand and Unemployment

Torben M Andersen

The Warwick Economics Research Paper Series (TWERPS) from University of Warwick, Department of Economics

Abstract: The coordination of production and consumption decisions is analysed in a static model where the interdependence between production, income and demand is explicitly modelled. With imperfect competition and non-convex production technologies it is shown that there exists a zero pure profit equilibrium with a positive level of employment and possible involuntary employment. Finally it is shown how to arrange a form of external intervention so as to ensure full employment.

Pages: 17 pages
Date: 1987
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https://warwick.ac.uk/fac/soc/economics/research/w ... 78-1988/twerp287.pdf

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Persistent link: https://EconPapers.repec.org/RePEc:wrk:warwec:287

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