%0 Report %T Continua of Underemployment Equilibria Reflecting Coordination Failures, Also at Walrasian Prices %+ Groupement de Recherche et d'Etudes en Gestion à HEC (GREGH) %+ CORE %+ Department of Economics %+ DIMADEFAS, Università degli Studi di Firenze %A Citanna, Alessandro %A Crès, Hervé %A Drèze, Jacques H. %A Herings, Jean-Jacques %A Villanacci, Antonio %Z Cahier de Recherche du Groupe HEC Paris, n° 732 %8 2001 %D 2001 %K general equilibrium %K underemployment %K coordination failures %K indeterminacy %Z Humanities and Social Sciences/Economics and Finance/domain_shs.eco.ecoReports %X In this paper the existence of unemployment is partly explained as being the result of coordination failures. It is shown that as a result of self-fulfilling pessimistic expectations, even at Walrasian prices, a continuum of equilibria results, among which an equilibrium with approximately no trade and a Walrasian equilibrium. These coordination failures also arise at other price systems, but then unemployment is the result of both a wrong price system and coordination failures. Some properties of the set of equilibria are analyzed. Generically, there exists a continuum of non-indifferent equilibrium allocations. Under a condition implied by gross substitutability, there exists a continuum of equilibrium allocations in the neighborhood of a competitive allocation, when prices are Walrasian. For a specialized economy, a dynamic illustration is offered. %G English %L hal-00597197 %U https://hec.hal.science/hal-00597197 %~ SHS %~ HEC %~ CNRS %~ AO-ECONOMIE %~ LARA