The paper proves that the Bayesian approach to learning and expectations formation implies no propositions that could … observations, and the assumption of Bayesian rationality. Since no betting strategy is irrational, Bayesianism is useless as a …

normative theory as well. -- Bayesianism ; Bayesian learning ; decision theory ; expectations ; learning ; rational expectations …The paper proves that the Bayesian approach to learning and expectations formation implies no propositions that could … observations, and the assumption of Bayesian rationality. Since no betting strategy is irrational, Bayesianism is useless as a …

In standard models of rational learning from experience, prior uncertainties and disagreements recede smoothly as …, uncertainties will surge and core disagreements widen. In general, rational learning tends to bifurcate into calm and turbulent …

We investigate the role played by the media in the expectations formation process of households. Using a novel news … of households' stated inflation expectations. In turn, in a noisy information model setting, augmented with a simple … rigidities among households varies across time, but also provide, using a large news corpus and machine learning algorithms …

. Bayesian learning implies that beliefs about the likelihood of rare disasters drop to a much more pessimistic level once a … persist for some time. Thus, belief dynamics are a source of apparent excess volatility relative to a rational expectations … between rational and adaptive Bayesian learning. Rational learners account for the possibility of future changes in beliefs in …

We propose an extension of the class of rational expectations bubbles (REBs) to the more general rational beliefs …

The rational expectations hypothesis (REH) is the standard approach to expectations formation in macroeconomics. We … discuss its compatibility with two strands of Karl Popper's philosophy: his theory of knowledge and learning, and his … "rationality principle" (RP). First, we show that the REH is utterly incompatible with the former. Second, we argue that the REH …