We examine local strong rationality (LSR) in multivariate models with both forward-looking expectations and predetermined variables. Given hypothetical common knowledge restrictions that the dynamics will be close to those of a specified minimal state variable solution, we obtain eductive...

Within the standard RBC model, we examine issues of expectational coordination on the unique rational expectations equilibrium. Our study first provides a comprehensive assessment of the sensitivity of agents’ ?plans and decisions to their short-run and long-run expectations. We show this...

This text reviews recent work on expectational coordination in general equilibrium models of the Walrasian tradition. It evokes briefly the multiplicity questions associated with infinite horizon models and the problems associated with "eductive learning". It examines in a more systematic way...

This is the text of the ?Jean-Jacques Laffont lecture?, closing the 2010 Congress of the afse, ?Association Française de Science Économique?. The first part comes back on the standard economic viewpoint on expectational coordination, a viewpoint that the recent events have challenged. The...

We consider a production economy where commodities are partitioned into irreproducible factors and reproducible goods, and the production technologies have constant returns to scale. We examine the geometry of the efficient frontier of the global production set and derive theorems of...

The first part of this text reviews the standard economic viewpoint on expectational coordination, a viewpoint that the recent events have challenged. The second part reviews different existing directions assessments of the rational expectations hypothesis that have been made to-date. The third...

We re-examine issues of coordination in the standard RBC model. Can the unique rational expectations equilibrium be “educed” by rational agents who contemplate the possibility of small deviations from equilibrium? Surprisingly, we find that coordination along this line cannot be expected....