Small departures from rationality magnify fluctuations

This note shows that introducing into the economy a few number of agents who do not support sunspots theories magnifies endogenous business cycles fluctuations when the current state of the economic system is sensitive enough to traders' forecasts, or equivalently, in presence of indeterminacy.

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Year of publication:	2004
Authors:	Faria, Joao Ricardo
Published in:	Economics Bulletin. - AccessEcon, ISSN 1545-2921. - Vol. 5.2004, 5, p. 1-5
Publisher:	AccessEcon

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Extent:	application/pdf
Type of publication:	Article
Language:	English
Classification:	E3 - Prices, Business Fluctuations, and Cycles
Source:	RePEc - Research Papers in Economics

Persistent link: https://www.econbiz.de/10005196400