A Note on Aggregation of Heteogeneous Expectations in a New Keynesian EconomyTags: working_papers, publications_from_2010
Publication date: 22.06.2010
This paper discusses conditions for aggregation of heterogeneous expectations in a new-keynesian economy. It shows that aggregation result depends on the way agents form cross-expectations, i.e. expectations on other agents' decision variables, and it determines a maximal class of cross-expectations operators that support aggregation.
Interpretation of obtained conditions in terms of equilibrium and coordination is provided. Although they are restrictive form a mathematical viewpoint, a class of operators which support aggregation and have a natural economic interpretation is discussed.download file PDF -->
entire project details --> <-- back to the list |
