Robustness of Dynamic Complexity under Variational Preferences Ambiguity, Anchoring, Belief Inertia and Overlapping Risk-Adjusted Priors

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Rapelanoro Heriony
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Rapelanoro Heriony: EHESS - École des hautes études en sciences sociales

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Abstract: We analyze the robustness of economic dynamics within a framework of recursive variational preferences incorporating ambiguity, anchoring, belief inertia, and riskadjusted sets of priors. We establish a stability theorem linking dynamic behavior to the overlapping conditions of risk-adjusted probability sets and show how ambiguity modifies the structure of the system, generating inertia, bifurcations, and market freezes.

Keywords: Recursive variational preferences; Dynamic stability; Robustness of economic dynamics; Risk‑adjusted sets of priors; Anchoring; Belief inertia; Ambiguity (search for similar items in EconPapers)
Date: 2026-02-12
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