This study seeks to uncover the factors determining the dynamic behavior of key macroeconomic variables in two emerging market economies, Turkey and Mexico, from the late 1980's to the present. For this purpose, we analyze the behavior of real interest rates, real stock returns, inflation,...

We propose a theory of asset pricing based on heterogeneous agents who continually adapt their expectations to the market that these expectations aggregatively create. And we explore the implications of this theory computationally using our Santa Fe artificial stock market.