A rational inattention unemployment trap
We show that introducing rational inattention into a model with uninsurable unemployment risk can generate multiple steady states, when the model with full information has a unique steady state. The model features persistent, heterogeneous labour market expectations, consistent with survey evidence....
| Main Authors: | , |
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| Format: | Journal article |
| Language: | English |
| Published: |
Elsevier
2021
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