Miao, Jianjun; Wu, Jieran; Young, Eric R. - In: Theoretical Economics 16 (2021) 1, pp. 275-315
We provide a production‐based asset pricing model with dispersed information and small deviations from full rational expectations. In the model, aggregate output and equity prices depend on the higher‐order beliefs about aggregate demand and individual stochastic discount factors. We prove...