The full set of solutions of linear rational expectations models

Bernd Funovits

Economics Letters, 2017, vol. 161, issue C, 47-51

Abstract: This article characterises the dimension of indeterminacy of linear rational expectations (LRE) models and derives their full set of solutions. It extends the analysis of indeterminate equilibria in Lubik and Schorfheide (2003) where some equilibria are incorrectly classified as indeterminate even though they entail the same observable outcome.

Keywords: Rational expectations; Indeterminacy; Full set of solutions (search for similar items in EconPapers)
JEL-codes: C62 E00 (search for similar items in EconPapers)
Date: 2017
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Citations: View citations in EconPapers (7)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:ecolet:v:161:y:2017:i:c:p:47-51

DOI: 10.1016/j.econlet.2017.09.021

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