Dynamic labour market model reveals key to economic stability and growth.
The article explores how markets adjust when they are not in balance. It looks at how companies and households make decisions when they don't have all the information about wages and labor costs. The study is mostly theoretical but also looks at real-world examples. The models discussed help us understand how the economy works when it's not in equilibrium, showing both Keynesian and Neoclassical features. The analysis suggests that in the short term, the economy can show characteristics of both Keynesian and Neoclassical theories, depending on the level of involuntary unemployment.