A representation of Keynes's long-term expectation in financial markets

Marcello Basili, Alain Chateauneuf, Giuliano Antonio and Giuseppe Scianna

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Abstract: This paper advances an intuitive representation of Keynes's notion of long-term expectation. We introduce the epsilon-contamination approach and represent the conventional judgment by the Steiner point of agents' common probability set. We anticipate a change in conventional judgment by updating the Steiner point.

Keywords: uncertainty; multiple priors. JEL classification: D81; Keynes long-term expectation epsilon contamination uncertainty multiple priors. JEL classification: D81; Keynes; long-term expectation; epsilon contamination (search for similar items in EconPapers)
Date: 2023-03-28
New Economics Papers: this item is included in nep-his, nep-hme and nep-pke
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