On Chaotic Consistent Expectations Equilibria

Abstract: The notion of c̱onsistent e̱xpectations e̱quilibria (CEE) as propagated by Hommes/Sorger (1998) is reviewed. Focusing on their example of a chaotic CEE constructed in the context of a cobweb model, it is argued that such an equilibrium is a temporary one. Assuming that an agent-modeled as an individual, versatile in applying the basic tools of linear time-series econometrics-has learned the CEE, I analyze the duration of the time period over which the agent maintains her/his beliefs concerning the perceived law of motion (AR (1)). The analysis based on numerical simulations indicates that the use of techniques rooted in the linear paradigm is sufficient to generate convincing evidence against the underlying perceived law of motion.

Object Details

• Location: Deutsche Nationalbibliothek Frankfurt am Main
• Extent: Online-Ressource
• Language: Englisch

References and Relationships

• Bibliographic citation: On Chaotic Consistent Expectations Equilibria ; volume:29 ; number:2 ; year:2007 ; pages:269-289 ; extent:21 ; Analyse & Kritik ; 29, Heft 2 (2007), 269-289 (gesamt 21)

Contributors, Places and Time

• Creator: Jungeilges, J. A.

Further information

• DOI: 10.1515/auk-2007-0210
• URN: urn:nbn:de:101:1-2404171626519.072608544485
• Rights: Open Access; Der Zugriff auf das Objekt ist unbeschränkt möglich.
• Last update: 14.08.2025, 10:52 AM CEST