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March 3, 2024European Journal of the History of Economic Thought2 citations

Towards a disequilibrated macroeconomics

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PHPeter Howitt

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Abstract

This paper elaborates on four different reasons why the assumption of continual dynamic stochastic general equilibrium, which is now standard in mainstream macroeconomics but is not used in agent based macro, makes a macro model less useful: (1) it assumes away most coordination problems, (2) it hides possible instabilities, (3) it makes money look unimportant, and (4) it makes inflation look trivial.

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Peter Howitt (2024) studied this question.

synapsesocial.com/papers/68e75ef0b6db6435876d5a9ahttps://doi.org/10.1080/09672567.2024.2329054
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