models of expectations formation that rely on econometric learning. Some apparently natural policy rules turn out to imply … expectational instability of private agents' learning. We use the standard New Keynesian model to illustrate this problem and survey … learning. We then consider some practical concerns such as measurement errors in private expectations, observability of …

agents forecast using adaptive learning. Because of the zero lower bound on interest rates, active interest rate rules are … learning dynamics we find the additional possibility of a liquidity trap, in which the economy slips below this low inflation …