interest rate rule, raising the possibility of inefficient fluctuations due to the dependence of expectations on extraneous … combine forward looking expectations and predetermined variables. We consider a variety of specifications that incorporate …

The way in which individual expectations shape aggregate macroeconomic variables is crucial for the transmission and … effectiveness of monetary policy. We study the individual expectations formation process and the interaction with monetary policy … heterogeneous expectations model with a performance-based evolutionary selection among heterogeneous forecasting heuristics to the …

requirement that the underlying rational expectations equilibrium is locally indeterminate. We suggest ways in which policymakers …