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Dynamic Models with Non-clearing Markets

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The New Palgrave Dictionary of Economics

Abstract

This article studies a new class of models which synthesize the two traditions of general equilibrium with non-clearing markets and imperfect competition on the one hand, and dynamic stochastic general equilibrium (DSGE) models on the other hand. This line of models has become a central paradigm of modern macroeconomics for at least three reasons: (a) it displays solid microeconomic foundations, (b) it is a highly synthetic theory, which combines in a unified framework general equilibrium, non-clearing markets, imperfect competition, growth theory and rational expectations, and (c) it is also an empirical success, leading to substantial progress towards matching real world statistics.

This chapter was originally published in The New Palgrave Dictionary of Economics, 2nd edition, 2008. Edited by Steven N. Durlauf and Lawrence E. Blume

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  1. http://link.springer.com/referencework/10.1057/978-1-349-95121-5

    Jean-Pascal Bénassy

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    Bénassy, JP. (2008). Dynamic Models with Non-clearing Markets. In: The New Palgrave Dictionary of Economics. Palgrave Macmillan, London. https://doi.org/10.1057/978-1-349-95121-5_2100-1

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    • DOI: https://doi.org/10.1057/978-1-349-95121-5_2100-1

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