Reflections on Modern Macroeconomics: Can We Travel Along a Safer Road?

In this paper we sketch some reflections on the pitfalls and inconsistencies of the research program - currently dominant among the profession - aimed at providing microfoundations to macroeconomics along a Walrasian perspective. We argue that such a methodological approach constitutes an unsatisfactory answer to a well-posed research question, and that alternative promising routes have been long mapped out but only recently explored. In particular, we discuss a recent agent-based, truly non-Walrasian macroeconomic model, and we use it to envisage new challenges for future research.Comment: Latex2e v1.6; 17 pages with 4 figures; for inclusion in the APFA5 Proceeding

Matching with Couples: a Multidisciplinary Survey

This survey deals with two-sided matching markets where one set of agents (workers/residents) has to be matched with another set of agents (firms/hospitals). We first give a short overview of a selection of classical results. Then, we review recent contributions to a complex and representative case of matching with complementarities, namely matching markets with couples. We discuss contributions from computer scientists, economists, and game theorists.matching; couples; stability; computational complexity; incentive compatibility; restricted domains; large markets

Paths to Stability for Matching Markets with Couples

We study two-sided matching markets with couples and show that for a natural preference domain for couples, the domain of weakly responsive preferences, stable outcomes can always be reached by means of decentralized decision making. Starting from an arbitrary matching, we construct a path of matchings obtained from `satisfying' blocking coalitions that yields a stable matching. Hence, we establish a generalization of Roth and Vande Vate's (1990) result on path convergence to stability for decentralized singles markets. Furthermore, we show that when stable matchings exist, but preferences are not weakly responsive, for some initial matchings there may not exist any path obtained from `satisfying' blocking coalitions that yields a stable matching.Matching, Couples, Stability, Random Paths, Responsiveness.

Adaptive microfoundations for emergent macroeconomics

In this paper we present the basics of a research program aimed at providing microfoundations to macroeconomic theory on the basis of computational agentbased adaptive descriptions of individual behavior. To exemplify our proposal, a simple prototype model of decentralized multi-market transactions is offered. We show that a very simple agent-based computational laboratory can challenge more structured dynamic stochastic general equilibrium models in mimicking comovements over the business cycle.Microfoundations of macroeconomics, Agent-based economics, Adaptive behavior

Ramón y Cajal: Mediation and Meritocracy

The Ramón y Cajal Program promotes the hiring of top researchers in Spanish R&D centers and academic institutions. The centralized mechanism associated to the Program is analyzed. The paper models it as a two-sided matching market and studies if it provides the incentives to increase the quality of the researchers hired. We analyze the mechanism both under complete and incomplete information. The comparison of the theoretical findings with the available data points out that the mechanism provides poor incentives and does not prevent collusion between research departments and candidates in the hiring process.Matching Markets; Preagreements; Implementation.

Debt stabilization in a Non-Ricardian economy

In models with a representative infinitely lived household, tax smoothing implies that the steady state of government debt should follow a random walk. This is unlikely to be the case in overlapping generations (OLG) economies, where the equilibrium interest rate may differ from the policy maker's rate of time preference. It may therefore be optimal to reduce debt today to reduce distortionary taxation in the future. In addition, the level of the capital stock in these economies is likely to be suboptimally low, and reducing government debt will crowd in additional capital. Using a version of the Blanchard-Yaari model of perpetual youth, with both public and private capital, we show that it is optimal in steady state for the government to hold assets. However, we also show how and why this level of government assets can fall short of both the level of debt that achieves the optimal capital stock and the level that eliminates income taxes. Finally, we compute the optimal adjustment path to this steady state