EconPapers    
Economics at your fingertips  
 

Expectational Stability of Stationary Sunspot Equilibria in a Forward-looking Linear Model

George Evans () and Seppo Honkapohja ()

University of Oregon Economics Department Working Papers from University of Oregon Economics Department

Abstract: We consider the stability under adaptive learning of the complete set of solutions to the model x_i=beta(Ei*)(x_i+1) when |beat| >1. In addition to the fundamentals solution, the literature describes both finite-state Markov sunspot solutions and autoregressive solutions depending on an arbitrary martingale difference sequence. We clarify the relationships between these solutions and show that the stability properties of equilibria may depend crucially on the representations used by agents in the learning process. Autoregressive forms of solutions are not learnable, but finite-state Markov sunspot solutions are stable under learning if beta

Keywords: Indeterminacy; representations of solutions; learnability; expectational stability; endogenous fluctuations (search for similar items in EconPapers)
JEL-codes: C62 D83 D84 E31 E32 (search for similar items in EconPapers)
Pages: 15
Date: 2002-01-14, Revised 2002-01-14
New Economics Papers: this item is included in nep-dge and nep-mac
References: Add references at CitEc
Citations: Track citations by RSS feed

Downloads: (external link)
http://economics.uoregon.edu/papers/UO-2001-9_Evans_Expectational_Stability.pdf (application/pdf)
Our link check indicates that this URL is bad, the error code is: 404 Not Found (http://economics.uoregon.edu/papers/UO-2001-9_Evans_Expectational_Stability.pdf [301 Moved Permanently]--> https://economics.uoregon.edu/papers/UO-2001-9_Evans_Expectational_Stability.pdf)

Related works:
Journal Article: Expectational stability of stationary sunspot equilibria in a forward-looking linear model (2003) Downloads
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:ore:uoecwp:2001-9

Access Statistics for this paper

More papers in University of Oregon Economics Department Working Papers from University of Oregon Economics Department Contact information at EDIRC.
Bibliographic data for series maintained by Bill Harbaugh ().

 
Page updated 2021-09-13
Handle: RePEc:ore:uoecwp:2001-9