SWITCHING COSTS AND SECTORAL ADJUSTMENTS IN GENERAL EQUILIBRIUM WITH UNINSURED RISK
成果类型：
Article
署名作者：
DIXIT, A; ROB, R
署名单位：
University of Pennsylvania
刊物名称：
JOURNAL OF ECONOMIC THEORY
ISSN/ISSBN：
0022-0531
DOI：
10.1006/jeth.1994.1003
发表日期：
1994
页码：
48-69
关键词：
摘要：
Consider a two-sector economy subject to recurring technological shocks. These affect earnings in the two sectors differently, creating incentives for workers to switch occupation. Switching costs arc sunk. Individuals are risk-averse and cannot diversify their income risk. We characterize the rational expectations equilibrium of the economy and illustrate the extent to which uncertainty and switching costs increase labor immobility. The resulting equilibrium is not even second-best optimal. Even a government that cannot transfer income to achieve insurance can improve matters by speeding up the reallocation of labor across sectors, because that reduces relative price variability. (C) 1994 Academic Press, Inc.