The paper derives conditions for eductive stability of rational expectations equilibria in simple linear economic models with private information. Following Guesnerie (1992; 2002), the concept of eductive stability is used. It is shown that even in a private information setting, rational...

The paper demonstrates how the E-stability principle introduced by Evans and Honkapohja [2001. Learning and Expectations in Macroeconomics. Princeton University Press, Princeton, NJ] can be applied to models with heterogeneous and private information in order to assess the stability of rational...

In a recent paper Ganguli and Yang [2009] demonstrate, that there can exist multiple equilibria in a financial market model á la Grossman and Stiglitz [1980] if traders possess private information regarding the supply of the risky asset. The additional equilibria differ in some important...

This paper analyzes the relationship between the expectational stability of rational expectations equilibria and the possible convergence of adaptive learning processes. Results obtained using recursive least squares lead to the conjecture that a correspondence between these both selection...

This paper analyzes the relationship between the expectational stability of rational expectations equilibria and the possible convergence of adaptive learning processes. Results obtained using recursive least squares lead to the conjecture that a correspondence between these both selection...

This paper discusses the emergence of endogenous redistributive cycles in a stochastic growth model with incomplete asset markets and heterogeneous agents, where agents vote on the degree of progressivity in the tax.transfer.scheme. The model draws from Bénabou (1996) and ties the bias in the...