Introduction

Abstract

Considerable work has been done in recent years on estimating macroeconomic “rationing” or “disequilibrium” models. Important examples are Sneessens (1983), Artus, Laroque and Michel (1984), Kooiman and Kloek (1985), Sneessens and Drèze (1986), Lambert (1984, 1988) and Laroque (1988), among others. These models are inspired by a branch of economic theory which is associated with the names of Clower, Leijonhufvud, Barro/Grossman, Benassy, Drèze and Malinvaud and has been labelled ‘New Keynesian Macroeconomics’. The basic message of this approach is that prices (wages, interest rates) adjust too slowly to clear markets permanently so that some agents (those on the “long” side of a market) get rationed and will revise their trade plans, thus causing spillovers across markets. The various econometric problems of formulating, estimating and testing disequilibrium models are discussed in Gourieroux, Laffont and Monfort (1980,1984), Ito (1980), Quandt (1982,1988), Sneessens (1985) and Laroque and Salanie (1989). The purpose of the present investigation is to develop an econometric two-market disequilibrium model for Switzerland, concentrating on the markets for goods and labor. This introduction attempts to put the disequilibrium approach into theoretical perspective, comparing it with the two main competing paradigms, standard Neo-Keynesian and new-classical models (sections 1.1 and 1.2). The specific features and limitations of the present study are outlined in section 1.3.