Non-implementation of Rational Expectations as a Perfect Bayesian Equilibrium

We show that a rational expectations equilibrium need not be incentive compatible, need not be implementable as a perfect Bayesian equilibrium and may not be fully Pareto optimal, unless the utility functions are state independent. A comparison of rational expectations equilibria with core concepts is also provided.

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Year of publication:	2004-02
Authors:	Glycopantis, Dionysius ; Muir, Allan ; Yannelis, Nicholas C.
Institutions:	Department of Economics and Finance Research and Teaching, Institut für Höhere Studien (IHS)
Subject:	Differential information economy \| Rational expectations equilibrium \| Implementation \| Game trees \| Private core

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Extent:	application/pdf
Series:	Economics Series.
Type of publication:	Book / Working Paper
Language:	English
Notes:	Number 148 38 pages
Classification:	C71 - Cooperative Games ; C72 - Noncooperative Games ; D5 - General Equilibrium and Disequilibrium ; D82 - Asymmetric and Private Information
Source:	RePEc - Research Papers in Economics

Persistent link: https://www.econbiz.de/10005704188