This chapter investigates the implications of adaptive learning in the private sector's formation of inflation expectations for the conduct of monetary policy. We first review the literature that studies the implications of adaptive learning processes for macroeconomic dynamics under various...

We review and evaluate methods previously adopted in the applied literature of adaptive learning in order to initialize agents' beliefs. Previous methods are classified into three broad classes: equilibrium-related, training sample-based, and estimation-based. We conduct several simulations...