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interdependence because information about each state affects both decisions. Senders are imperfectly informed and communication … one of the states. I show that communication depends on how the interdependence aggregates decision-specific biases. This … aggregation can lead to positive or negative informational spillovers, which affect communication incentives. Secondly, I analyse …
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A theoretical curiosity remains in the Huggett [1993] model as to the possible existence of a unique and degenerate stationary distribution of agent types. This coincides with the possibility that an equilibrium individual state space may turn out to be trivial in the sense that every agent...
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The seminal work of Huggett [“The risk-free rate in heterogeneous-agent incomplete-insurance economies”, Journal of Economic Dynamics and Control, 1993, 17(5-6), 953-969] showed that there exists a unique stationary distribution of agent types, given by their individual states of asset and...
Persistent link: https://www.econbiz.de/10013138713
This paper describes a method for solving a class of forward-looking Markov-switching Rational Expectations models under noisy measurement, by specifying the unobservable expectations component as a general-measurable function of the observable states of the system, to be determined optimally...
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