A dynamic model of expectations equilibrium

J. S. Jordan

Research output: Contribution to journalArticle

9 Scopus citations

Abstract

This paper describes a dynamic information adjustment process which achieves (rational) expectations equilibria for stochastic exchange environments. An informational temporary equilibrium is an exchange equilibrium in which agents' expectations are conditioned on their initial information and market data generated in previous informational temporary equilibria. An equilibrium is a temporary equilibrium which reveals no further information. This process leads to an equilibrium even when the data observed by agents is insufficient to permit the existence of an expectations equilibrium.

Original languageEnglish (US)
Pages (from-to)235-254
Number of pages20
JournalJournal of Economic Theory
Volume28
Issue number2
DOIs
StatePublished - Dec 1982

All Science Journal Classification (ASJC) codes

  • Economics and Econometrics

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