Unemployment benefits and financial factors in an agent-based macroeconomic model

Luca Riccetti, Alberto Russo and Mauro Gallegati

No 2013-9, Economics Discussion Papers from Kiel Institute for the World Economy (IfW Kiel)

Abstract: This paper is aimed at investigating the effects of government intervention through unemployment benefits on macroeconomic dynamics in an agent-based decentralized matching framework. The major result is that the presence of such a public intervention in the economy stabilizes the aggregate demand and the financial conditions of the system at the cost of a modest increase of both the inflation rate and the ratio between public deficit and nominal GDP. The successful action of the public sector is sustained by the central bank, which is committed to buy outstanding government securities.

Keywords: Agent-based macroeconomics; business cycle; crisis; unemployment; leverage (search for similar items in EconPapers)
JEL-codes: C63 E32 (search for similar items in EconPapers)
Date: 2013
New Economics Papers: this item is included in nep-cmp and nep-mac
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (10)

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Persistent link: https://EconPapers.repec.org/RePEc:zbw:ifwedp:20139

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