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Equilibrium unemployment theory Christopher A. Pissarides
Publisher: MIT

€�His book 'Equilibrium Unemployment Theory' is a standard reference in the economics of unemployment” One of the pioneers of matching theory approach to unemployment theory and a distinguished speaker, Prof. Sound's a bit like Say's Law, the theory that unemployment cannot increase indefinitely as eventually wages will fall and labour will become cheap. 1994 Report and Financial Statements. Hicks argued that it was possible for the economy to be in an equilibrium (a word I'll be labouring in this post) in which there was involuntary unemployment. The latter is entirely unexplained by the benchmark homogeneous-agent model of equilibrium unemployment theory. In production are centre stage. The v/u ratio plays a prominent role equilibrium unemployment theory; see Diamond, Mortensen and Pissarides. As long as the institutional parameters – λ, c and the tax rates – are constant, the mark-up factor depends positively on the probability of finding a job, a, and negatively on the probability of filling a vacancy, q. (Why the word In what became known as the microfoundations debate, neoclassicals attacked the Keynesian part of the profession with the charge that Keynes “did not have good microfoundations” – that Keynesian results like an equilibrium with unemployment contradicted microeconomic theory. Equilibrium Unemployment Theory, Cambridge: MIT. €�I don't really buy the assumptions about rationality and markets that are embedded in many modern theoretical models, my own included, and I often turn to Old Keynesian ideas, but I see the usefulness of such models as a way to think through some issues carefully – an attitude that is actually widely shared Hicks argued that it was possible for the economy to be in an equilibrium (a word I'll be labouring in this post) in which there was involuntary unemployment. He has written extensively in professional journals and his book Equilibrium Unemployment Theory is an influential reference in the economics of unemployment and has been translated in many languages. Finally, when it comes to labour market coordina- tion, we review different theories of imperfectly competitive labour markets. The Great Depression disproved that theory. As the following diagram shows, labor-market-tightness is highly procyclical.