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A finite set of equilibria for the indeterminacy of linear rational expectations models

Chatelain, Jean-Bernard; Ralf, Kirsten - 2014

This paper demonstrates the existence of a finite set of equilibria in the case of the indeterminacy of linear rational … eigenvectors related to stable eigenvalues. A finite set of equilibria is a substitute to continuous (uncountable) sets of sunspots …

Persistent link: https://www.econbiz.de/10011525764

Heterogeneous expectations, indeterminacy, and postwar US business cycles

Ilabaca, Francisco; Milani, Fabio - 2020

postwar US macroeconomic data can be explained as the outcome of passive monetary policy, indeterminacy, and sunspot … windows and allowing the parameters to fall both in the determinacy and indeterminacy regions. The estimates reveal large … the sample. The results confirm that macroeconomic data in the early windows are better explained by indeterminacy, while …

Persistent link: https://www.econbiz.de/10012200338

Monetary policy and sentiment-driven fluctuations

Chan, Jenny - 2020

Persistent link: https://www.econbiz.de/10012501082

Rational sentiments and financial frictions

Khorrami, Paymon; Mendo, Fernando - 2024

We discover sentiment-driven equilibria in popular models of imperfect risk sharing. In these equilibria, sentiment dynamics behave like uncertainty shocks, in the sense that self-fulfilled beliefs about volatility drive aggregate fluctuations. Because such fluctuations can decouple from the...

Persistent link: https://www.econbiz.de/10015329687

News versus sunspot shocks in a New Keynesian model

Karnizova, Lilia - In: Economics: The Open-Access, Open-Assessment E-Journal 4 (2010) 2010-19, pp. 1-27

monetary policy and sunspots. The key distinction between the shocks lies in their relation to the realized policy shock. If … monetary policy is 'active', the sunspots are irrelevant, and the model responses to the news shocks are unique. In both cases …

Persistent link: https://www.econbiz.de/10010300732

Expectations, self-fulfilling prophecies and the business cycle

Dufourt, Frédéric; Nishimura, Kazuo; Venditti, Alain - 2022 - Revised: October 2022

Persistent link: https://www.econbiz.de/10013549413

Expectational stability of sunspot equilibria in non-convex economies

McGough, Bruce; Meng, Qinglai; Xue, Jianpo - In: Journal of economic dynamics & control 37 (2013) 6, pp. 1126-1141

Persistent link: https://www.econbiz.de/10009740450

Indeterminacy and forecastability

Fujiwara, Ippei; Hirose, Yasuo - In: Journal of money, credit and banking : JMCB 46 (2014) 1, pp. 243-251

Persistent link: https://www.econbiz.de/10010464127

Rational sunspots

Ascari, Guido; Bonomolo, Paolo; Lopes, Hedibert Freitas - 2016

Persistent link: https://www.econbiz.de/10011451589

News shocks or correlated sunspots? : an observational equivalence result in linear rational expectations model

Sorge, Marco M. - 2011

This paper studies identification of linear rational expectations models under news shocks. Exploiting the general martingale difference solution approach, we show that news shocks models are observationally equivalent to a class of indeterminate equilibrium frameworks which are subject only,...

Persistent link: https://www.econbiz.de/10011524859