non-clearing markets in general equilibrium
From The New Palgrave Dictionary of Economics, Second Edition, 2008
Edited by
Steven
N.
Durlauf
and
Lawrence
E.
Blume
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Abstract
In this article we study models with non-clearing markets in a full general equilibrium framework. The theories we describe synthesize three major schools of thought, Walrasian, Keynesian and imperfect competition. This synthesis is notably achieved by introducing quantity signals in addition to price signals into the traditional general equilibrium model. This considerably enlarges the scope of traditional general equilibrium, allowing us not only to construct equilibria with various price rigidities but also to endogenize prices in a decentralized imperfect competition framework.
Keywords
active demand; budget constraint; dual decision method; fixprice equilibria; fixprice-fixwage macroeconomic model; frictions; general equilibrium; imperfect competition; Keynesianism; market efficiency; monopolistic competition; non-clearing markets in general equilibrium; non-tâtonnement processes; objective demand curve; overbidding; price making; price signals; price taking; quantity constraints; quantity signals; quasi-equilibrium; rational expectations; rationing; subjective demand curves; Walrasian equilibrium
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How to cite this article
Bénassy, Jean-Pascal. "non-clearing markets in general equilibrium." The New Palgrave Dictionary of Economics. Second Edition. Eds. Steven N. Durlauf and Lawrence E. Blume. Palgrave Macmillan, 2008. The New Palgrave Dictionary of Economics Online. Palgrave Macmillan. 20 May 2013 <http://www.dictionaryofeconomics.com/article?id=pde2008_N000153> doi:10.1057/9780230226203.1190

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