Adaptively evolving expectations in models of monetary dynamics: The fundamentalists forward looking

Authors
Chiarella, C Khomin, P
Citation
C. Chiarella et P. Khomin, Adaptively evolving expectations in models of monetary dynamics: The fundamentalists forward looking, ANN OPER R, 89, 1999, pp. 21-34
Citations number
24
Categorie Soggetti
Engineering Mathematics
Journal title
ANNALS OF OPERATIONS RESEARCH
ISSN journal
02545330 → ACNP
Volume
89
Year of publication
1999
Pages
21 - 34
Database
ISI
SICI code
0254-5330(1999)89:<21:AEEIMO>2.0.ZU;2-S
Abstract
In the basic Cagan model of monetary dynamics, we allow inflationary expect ations to be formed as a weighted average of fundamentalist and chartists e xpectations. We allow the weights to evolve adaptively according to the mec hanism of Brock and Hommes [3] and study the resulting dynamic behaviour.