Price expectations in goods and financial markets

Georges Prat and François Gardes ()
Additional contact information
François Gardes: CERMSEM - CEntre de Recherche en Mathématiques, Statistique et Économie Mathématique - UP1 - Université Paris 1 Panthéon-Sorbonne - CNRS - Centre National de la Recherche Scientifique

Post-Print from HAL

Abstract: Four main lessons stem from the works presented in this volume. First, the rational expectation hypothesis has to go thoroughly into more general concepts. If the REH in a muthian sense seems now invalidated, this result does not mean that there is not rationality in price expectations : in the one hand, expectations may be economically rational in the sense of the advantage-cost analysis, and, in the other hand, the exchange of informations between agents through the market may involve some other types of rationalities. Secondly, it appears important to respect the individual nature of expectations both at the theoretical and empirical levels : generally, the heterogeneity is not neutral either for reaching an economic equilibrium or for econometrical estimations of expectational processes. Thirdly, expectational behaviors change over time ; both the processes and the parameters which intervene in these processes are changing. Fourthly, while expectational processes are rather extrapolative (destabilizing) when the horizon is short (less or equal to one month), they are rather regressive (stabilizing) when the horizon is long (greater than one month).

Keywords: self-fulfilling expectations; game theory; theory of information; imitative expectations; rare events; stock price expectations; exchange rate expectations; inflationary expectations (search for similar items in EconPapers)
Date: 2000
References: Add references at CitEc
Citations: View citations in EconPapers (21)

Published in François Gardes et Georges Prat. Edward Elgar, pp.302, 2000

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

Related works:
Working Paper: Price expectations in goods and financial markets (2000)
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:hal:journl:halshs-00172996

Access Statistics for this paper

More papers in Post-Print from HAL
Bibliographic data for series maintained by CCSD ().