How to get the Blanchard-Kahn form from a general linear rational expectations model

Raouf Boucekkine (), Cuong Le van and Katheline Schubert

UC3M Working papers. Economics from Universidad Carlos III de Madrid. Departamento de Economía

Abstract: In this paper, we prove that every linear model with rational expectations can be transformed by the means of an one-to-one mapping into another model which has one of the following properties: i) it is degenerated, ii) it is backward, ii) it has the Blanchard-Kahn form. In addition to sorne simple illustrations, we provide two applications on two nonlinear forward-looking economic models in order to show how to use our theoretical analysis for local stability assessment.

Keywords: Rational; Expectations; Blanchard-Kahn; Form; Reduction; Algorithms (search for similar items in EconPapers)
Date: 1996-04
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Citations: View citations in EconPapers (2)

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Working Paper: How to Get the Blanchard-Kahn Form from a General Linear Rational Expectations Model
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Persistent link: https://EconPapers.repec.org/RePEc:cte:werepe:3974

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