Showing 1 - 7 of 7
This paper attemps to identify, in a framework deliberately stripped of unnecessary technical- ities, some of the basic reasons why adaptive learning may or may not lead to stability and convergence to self-fulfilling expectations in large socioeconomic systems where no agent, or collection of...
Persistent link: https://www.econbiz.de/10005043711
This paper develops an adaptive learning scheme for a standard version of the OLG model with pure exchange. Perfect forecasting rules which generate perfect foresight orbits are approximated by cubic spline functions. These approximations are successively constructed using historical data only....
Persistent link: https://www.econbiz.de/10005596637
Incorporating adaptive learning into macroeconomics requires assumptions about how agents incorporate their forecasts into their decision-making. We develop a theory of bounded rationality that we call finite-horizon learning. This approach generalizes the two existing benchmarks in the...
Persistent link: https://www.econbiz.de/10008774192
Agents have two forecasting models, one consistent with the unique rational expectations equilibrium, another that assumes a time-varying parameter structure. When agents use Bayesian updating to choose between models in a self-referential system, we find that learning dynamics lead to selection...
Persistent link: https://www.econbiz.de/10010676190
We present experiments on repeated non-cooperative network formation games, based on Bala and Goyal (2000). We treat the one-way and the two-ways flow models, each for high and low link costs. The models show both multiple equilibria and coordination problems. We conduct experiments under...
Persistent link: https://www.econbiz.de/10010312592
We present experiments on repeated non-cooperative network formation games, based on Bala and Goyal (2000). We treat the one-way and the two-ways flow models, each for high and low link costs. The models show both multiple equilibria and coordination problems. We conduct experiments under...
Persistent link: https://www.econbiz.de/10005385417
This paper presents a model of non-cooperative network formation similar to Bala and Goyal (2000), except that marginal costs in the size of the network is increasing. Agents link among each other to gain information and update their links according to a better reply dynamics. In the long run...
Persistent link: https://www.econbiz.de/10005697652