Deflationary Recessions in a General-Equilibrium Framework

Luca Vittorio Angelo Colombo, Gerd Hellmut Weinrich

Research output: Chapter in Book/Report/Conference proceedingChapter

1 Citation (Scopus)

Abstract

This paper investigates the role of fiscal and monetary shocks in the occurrence of deflationary recessions. Our model is based on a temporary equilibrium approach with stochastic rationing, where inventory dynamics is explicitly taken into account, amplifying spillover effects between markets. This setting allows us to study the driving forces behind disequilibrium phenomena, and to investigate the efficacy of alternative policies in overcoming them. In particular, we provide for an application of our approach to the study of the Japanese deflationary recession.
Original languageEnglish
Title of host publicationThe Complex Networks of Economic Interactions
EditorsA. Namatame, T. Kaizouji, Y. Aruka
Pages125-138
Number of pages14
Publication statusPublished - 2006

Publication series

NameLECTURE NOTES IN ECONOMICS AND MATHEMATICAL SYSTEMS

Keywords

  • Inventories
  • deflationary recessions
  • non-tâtonnement
  • price adjustment

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