EXPECTATIONS OF LEARNING AGENTS AND STABILITY OF PERFECT FORESIGHT EQUILIBRIA IN DISCRETE TIME DYNAMIC ECONOMIC MODELS

Domenico Colucci and Vincenzo Valori ()

No 218, Computing in Economics and Finance 2000 from Society for Computational Economics

Abstract: We study the global dynamic properties of stationary equilibria in discrete time deterministic models under bounded rationality. We assume agents' ability to learn from the past performance of their expectations formation mechanism, so that such mechanism itself is made endogenous. We determine sufficient conditions under which this type of error learning behaviour enhances the stability properties of the economic system and rules out non-perfect foresight cycles. This outcome, while partly at odds with some existing results in the economic literature, seems plausible from the point of view of economic intuition.

Date: 2000-07-05

There are no downloads for this item, see the EconPapers FAQ for hints about obtaining it.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: http://EconPapers.repec.org/RePEc:sce:scecf0:218

Access Statistics for this paper

More papers in Computing in Economics and Finance 2000 from Society for Computational Economics
Address: CEF 2000, Departament d'Economia i Empresa, Universitat Pompeu Fabra, Ramon Trias Fargas, 25,27, 08005, Barcelona, Spain
Contact information at EDIRC.
Series data maintained by Christopher F. Baum ().