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We consider the regret matching process with finite memory. For general games in normal form, it is shown that any recurrent class of the dynamics must be such that the action profiles that appear in it constitute a closed set under the “same or better reply” correspondence (CUSOBR set) that...
Persistent link: https://www.econbiz.de/10013142570
We consider the regret matching process with finite memory. For general games in normal form, it is shown that any recurrent class of the dynamics must be such that the action profiles that appear in it constitute a closed set under the “same or better reply” correspondence (CUSOBR set) that...
Persistent link: https://www.econbiz.de/10008688945
Persistent link: https://www.econbiz.de/10010191371
The recent macroeconomic literature stresses the importance of managing heterogeneous expectations in the formulation of monetary policy. We use a simple frictionless DSGE model to investigate inflation dynamics under alternative interest rate rules when agents have heterogeneous expectations...
Persistent link: https://www.econbiz.de/10013117071
We propose behavioral learning equilibria as a plausible explanation of coordination of individual expectations and aggregate phenomena such as excess volatility in stock prices and high persistence in inflation. Boundedly rational agents use a simple univariate linear forecasting rule and...
Persistent link: https://www.econbiz.de/10013088595
Persistent link: https://www.econbiz.de/10010191433
The recent macroeconomic literature stresses the importance of managing heterogeneous expectations in the formulation of monetary policy. We use a stylized macro model of Howitt (1992) to investigate inflation dynamics under alternative interest rate rules when agents have heterogeneous...
Persistent link: https://www.econbiz.de/10011378358
In a local interaction model agents situated on a circle play bilateral prisoners' dilemmas with their immediate neighbors and have three possible strategies: cooperate in all interactions (altruistic), defect in all interactions (egoistic), or cooperate with one immediate neighbor with...
Persistent link: https://www.econbiz.de/10012869525
Persistent link: https://www.econbiz.de/10010420254
Persistent link: https://www.econbiz.de/10005094145