Towards Keynesian DSGD (isequilibrium) Modelling: Real-Financial Market Interactions with Heterogeneous Expectations Dynamics

Arbeitspapier

We consider an alternative modelling approach to the mainstream DSGE paradigm, namely basically a Dynamic Stochastic General Disequilibrium model of continuous adjustment processes on interacting real and financial markets. We introduce heterogeneous capital gain expectations (chartists and fundamentalists) and show that the first type of agents tends to destabilise he economy. Global stability can be ensured if opinions favour fundamentalist behaviour far off the steady state. This interaction of expectations and population dynamics is bounding the real-financial market interactions, but allows for irregular behaviour within these bounds. Stability can be further improved by adding suitable policy measures.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: IMK Working Paper ; No. 93

Classification and Topics

• Classification: Wirtschaft ; General Aggregative Models: Keynes; Keynesian; Post-Keynesian ; Employment; Unemployment; Wages; Intergenerational Income Distribution; Aggregate Human Capital; Aggregate Labor Productivity ; Price Level; Inflation; Deflation ; Monetary Policy
• Subject: Output dynamics ; Portfolio Adjustments ; Opinion Dynamics ; Viability ; Policy Measures ; Dynamisches Gleichgewicht ; Neukeynesianische Makroökonomik ; Finanzmarkt ; Erwartungstheorie ; Anlageverhalten ; Finanzanalyse ; Tobinsteuer ; Theorie

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Charpe, Matthieu ; Flaschel, Peter ; Hartmann, Florian ; Veneziani, Roberto
• Event: Veröffentlichung
• (who): Hans-Böckler-Stiftung, Institut für Makroökonomie und Konjunkturforschung (IMK)
• (where): Düsseldorf
• (when): 2012

Further information

• Handle: http://hdl.handle.net/10419/105957
• URN: urn:nbn:de:101:1-201211143571
• Last update: 10.03.2025, 11:45 AM CET