Instability and indeterminacy in a simple search and matching model

Michael Krause and Thomas Lubik

No 2010,25, Discussion Paper Series 1: Economic Studies from Deutsche Bundesbank

Abstract: 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.

Keywords: search and matching; indeterminacy; match elasticity (search for similar items in EconPapers)
JEL-codes: E24 E32 J64 (search for similar items in EconPapers)
Date: 2010
New Economics Papers: this item is included in nep-dge, nep-lab and nep-mac
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Citations: View citations in EconPapers (16)

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Persistent link: https://EconPapers.repec.org/RePEc:zbw:bubdp1:201025

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