An Exploration of the Eductive Justifications of the Rational-Expectations Hypothesis

Roger Guesnerie ()

American Economic Review, 1992, vol. 82, issue 5, 1254-78

Abstract: This paper examines justifications of the rational-expectations hypothesis that rely on the analysis of the agents' mental forecasting ("educing") activity (which involves "forecasting the forecasts" of others, etc.). The corresponding concept of eductive learning stability, based on the game-theoretical concept of rationalizability, is primarily used within the classical Muth model. Conditions for coordination of beliefs are interpreted and discussed; they are robust to the introduction of noise. More generally, eductive stability fits economic intuition on coordination: stability increases when the industry product differentiation increases and when decisions are sequential and observable. Copyright 1992 by American Economic Association.

Date: 1992
References: Add references at CitEc
Citations: View citations in EconPapers (108)

Downloads: (external link)
http://links.jstor.org/sici?sici=0002-8282%2819921 ... O%3B2-Y&origin=repec full text (application/pdf)
Access to full text is restricted to JSTOR subscribers. See http://www.jstor.org for details.

Related works:
Working Paper: An Exploration of the Eductive Justifications of the Rational Expectations Hypotbesis (1989)
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: https://EconPapers.repec.org/RePEc:aea:aecrev:v:82:y:1992:i:5:p:1254-78

Ordering information: This journal article can be ordered from
https://www.aeaweb.org/journals/subscriptions

Access Statistics for this article

American Economic Review is currently edited by Esther Duflo

More articles in American Economic Review from American Economic Association Contact information at EDIRC.
Bibliographic data for series maintained by Michael P. Albert ().