ON THE SUSTAINABILITY OF GOVERNMENT BORROWING IN A DYNAMIC GENERAL EQUILIBRIUM

Abstract.  This paper constructs a dynamic general equilibrium model with money in consumers' utility functions and investigates the equilibrium dynamics of government's debt. The limitation level of the government borrowing for which a dynamic equilibrium and the no Ponzi Game condition are compatible with each other is explicitly derived. The critical level depends on the long-run interest rate, primary balance, money supply etc.     

JOB SEARCH AND ASSET ACCUMULATION UNDER BORROWING CONSTRAINTS*

This article examines the relationship between wealth accumulation and job search dynamics. It proposes a model in which risk‐averse individuals search for jobs, save, and borrow to smooth their consumption. One motivation for accumulating wealth is to finance voluntary quits in order to search for better jobs. Using data on men from the National Longitudinal Survey (1979 cohort), I estimate the individual's dynamic decision problem. The results show that borrowing constraints are tight and reinforce the influence of wealth on job acceptance decisions, namely that more initial wealth and access to larger amounts of credit increase wages and unemployment duration.     

COLLECTIVE BARGAINING,AWARENESS OF GENERAL EQUILIBRIUM EFFECTS,AND UNEMPLOYMENT*

We explore the significance of general equilibrium feedback effects for wage‐bargaining. We examine a two‐sector economy and show that if agents only consider labor demand effects low real wages and low unemployment are the consequences. With an intermediate view, i.e., when partial equilibrium effects within a sector are taken into account, high real wages and unemployment result. If all general equilibrium effects are perceived simultaneously, we once again obtain a situation with low wages and unemployment. The results may explain why unemployment is high in some European countries.     

INPUT AND OUTPUT INVENTORIES IN GENERAL EQUILIBRIUM*

We build and estimate a two‐sector dynamic stochastic general equilibrium model with two types of inventories: Input inventories facilitate the production of finished goods, output inventories yield utility services. The estimated model replicates the volatility and cyclicality of inventory investment and inventory‐to‐target ratios. Although inventories are an important element of the model’s propagation mechanism, shocks to inventory efficiency are not an important source of business cycles. When the model is estimated over two subperiods (pre‐ and post‐1984), changes in the volatility of inventory shocks or in structural parameters associated with inventories play a small role in reducing the volatility of output.     

GENERAL EQUILIBRIUM ANALYSIS OF OVERLAPPING GENERATIONS WITH HETEROGENEOUS TIME PREFERENCES

The overlapping generations model presented herein requires incorporation of exactly three periods in which one lives, but makes intertemporal decision‐making twice, neither once nor three times. Single decision‐making at the outset, none thereafter, ignores the fact that one makes decisions every day anew as long as tomorrow exists. Incorporating such observations most simply requires decisions to be made at the first period and the second, but not at the third or last period. Our model reveals how the Mabiki (infanticides) and the Narayama (elderlycides) can occur simultaneously. We also find conditions under which child‐indulgence and parental overprotection called sunekajiri might be reckoned a virtue.     

动态随机一般均衡模型： 文献研究与未来展望

动态随机一般均衡 （DSGE） 模型是近10多年来宏观经济学发展的主要标志物。它为研究经济增长和经济波动提供了统一的分析框架。DSGE模型的产生和发展大体上经历了实际的经济周期（RBC）模型和新凯恩斯主义DSGE模型两个阶段。DSGE模型是一种动态模型,又考虑了随机冲击,还具有所需数据信息较少的简约化特征,因而受到政策制定者尤其是中央银行的青睐。DSGE模型现在在理论基础、理论模型与实际数据的匹配性、模型的估计方法等方面还存在这样那样的问题,但是这个模型体现着现代宏观经济学的许多共识和发展趋势,随着贝叶斯方法与DSGE模型的有机融合,随着计算机性能和计算能力的不断提高,DSGE模型将会得到进一步发展和改进。     

SPECIALISATION AND THE EXISTENCE PROBLEM IN GENERAL EQUILIBRIUM THEORY

When the division of labour has been once thoroughly established,it is but a very small part of a man's wants which the produceof his own labour can supply... Every man thus lives by exchanging,or becomes in some measure a merchant and the society itselfgrows to be what is properly a commericial society (Smith, 1776,p. 22).     

GENERAL AND PARTIAL EQUILIBRIUM THEORY IN BORK'S ANTITRUST ANALYSIS

In applying economic theory to evaluate antitrust laws, Judge Robert Bork explicitly favors a partial equilibrium over a general equilibrium approach. He believes the general model assumes away too many real-world aspects to be usefully employed as a criterion by which to judge real-world laws.
However, Bork's partial equilibrium replacement, the Oliver Williamson trade-off model, implicitly contains many of the same assumptions as general equilibrium theory. Equilibrium prices in all industries, an absence of external effects, and well-defined demand curves are assumptions of both general equilibrium theory and the Williamson trade-off model. If one theory is judged inadequate because of these assumptions, so should the other.
Bork's analysis is more consistent with market process theory than with his own partial equilibrium approach. Market process theory assumes neither the absence of externalities, nor the presence of well-defined demand and equilibrium prices in all industries.     

OPENING THE FLOODGATES: PARTIAL AND GENERAL EQUILIBRIUM ADJUSTMENTS TO LABOR IMMIGRATION

We investigate the impact of a large immigration shock on occupational wages. We develop a general equilibrium model where individuals sort into occupations and confront testable hypotheses with data. To identify the effect of the labor supply shock, we introduce a novel instrument that exploits that immigrants systematically sort into different occupations than natives. We study the immigration wave to Norway after the Eastern enlargement and find that immigration led to lower relative occupational wages. A quantification of the general equilibrium shows welfare effects of immigration close to zero for natives, but negative effects for the pre-existing population of immigrants.     

货币流通速度和产出变动的动态一般均衡分析

结构冲击如何影响我国货币流通速度和产出变动的动态一般均衡分析结果表明:货币、制度冲击使货币流通速度和产出基本上同向变动。短期内,技术冲击使货币流通速度下降,表明我国狭义货币具有奢侈品特征。就货币流通速度的变动而言,制度和货币冲击具有持久的正向效应,制度冲击最重要,货币冲击次之,技术冲击不重要,没有长期影响。就产出的变动而言,货币冲击产生了持久的"Tobin效应",制度、技术冲击具有显著、持久的正向效应。制度冲击最重要,技术冲击次之,货币冲击不重要。     

MODELING THE EVOLUTION OF EXPECTATIONS AND UNCERTAINTY IN GENERAL EQUILIBRIUM

We develop methods to solve general equilibrium models in which forward‐looking agents are subject to waves of pessimism, optimism, and uncertainty that turn out to critically affect macroeconomic outcomes. Agents in the model are fully rational and conduct Bayesian learning, and they know that they do not know. Therefore, agents take into account that their beliefs will evolve according to what they will observe. This framework accommodates both gradual and abrupt changes in beliefs and allows for an analytical characterization of uncertainty. We use a prototypical Real Business Cycle model to illustrate the methods.     

HOUSING OVER TIME AND OVER THE LIFE CYCLE: A STRUCTURAL ESTIMATION

We construct a model of optimal life‐cycle housing and nonhousing consumption and estimate the elasticity between the two goods to be 0.487. The estimate is robust to different assumptions of housing adjustment cost, but sensitive to the choice of sample period and the degree of aggregation of data moments. We then conduct experiments in which house prices and household income fluctuate. Compared with the benchmark, the impact of the shocks on homeownership rates is reduced, but the impact on nonhousing consumption is magnified when housing service and nonhousing consumption are highly substitutable or when the house selling cost is sizable.