This webpage hosts the draft chapters from a book on which I’m working. The book is under contract with Princeton University Press.

Almost all markets have slack—idle or unemployed workers, unsold goods, empty seats. This book builds a theory of business cycles around that basic reality. It shows that slackish markets are generally inefficient, explains why recessions are costly, and describes how monetary and fiscal policy should stabilize the economy when slack surges.

Not all chapters are available at the moment, but more will be added over time. I’m sharing these draft chapters to invite feedback from readers. Your comments are invaluable in helping me make the book as correct, clear, and complete as possible. So please don’t hesitate to email me with comments and corrections.

Because this is a work in progress, the content and structure may change. Thank you for engaging with this preliminary version.

Front matter

Part I. Introduction

Part II. Slackish markets

Part III. Application to the labor market

Part IV. Slackish business cycles

Part V. Policies to stabilize slackish cycles

Part VI. Conclusion

Part VII. Technical appendix