Questions tagged [heterogeneous-expectations]
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What is steady state learning in the context of boundedly rational expectation modeling and how does it differ with other theories of learning?
What is steady state learning in the context of boundedly rational expectation modeling? E.g. see Evans et al. (2009)
They define it as: "Under steady-state learning, agents use past data to ...
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determinacy vs. indeterminacy of equilibria in dynamic systems
As explained in Hommes (2018), equilibria in dynamic systems, like DSGE models, can either be determinate or indeterminate. A REE (rational expectations equilibrium) is determinate when there exists a ...
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Does a monopolistically competitive market outcome involves assuming rational expectations?
E.g. When Grazzini et al. (2014) discuss a "monopolistically competitive outcome" (MC) in their paper ($2.1), which is based on Dixit-Stiglitz's model, 1977, does this outcome involve assuming ...
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Are heterogenous expectations models still determinate, closed models?
Cars Hommes proposed many models based on agents having heterogeneous expectations. Agents switch between a fixed set of prediction rules depending on their forecast error history. However, it seems ...