When is rational behavior consistent with rules of thumb?: a link between evolutionary terminology and neoclassical methodology
Article Abstract:
Suitable specification of the state space and the interaction structure leads to constant optimal decisions or routine behavior of firms. Ergodicity properties of stochastic processes characterize the nature of industry dynamics. The evolutionary approach is based on analogies between biological evolution and economic development by selection and survival of good strategies. A model has been developed as an economic setup in which the observation of time constant decisions is explained as optimal behavior in a dynamic stochastic interactive process.
Publication Name: The Journal of Mathematical Economics
Subject: Mathematics
ISSN: 0304-4068
Year: 1999
User Contributions:
Comment about this article or add new information about this topic:
Fully revealing equilibria in sequential economies with asset markets
Article Abstract:
A canonical general equilibrium economy model with asymmetric information was created to assess an economy with real assets and inherent uncertainty. The existing works of Radner (1979) are extended by contending that rational expectations equilibrium (REE) are fully revealing. Results show a slight deviation from Radner due to the differences in budget constraints of the models used.
Publication Name: The Journal of Mathematical Economics
Subject: Mathematics
ISSN: 0304-4068
Year: 1998
User Contributions:
Comment about this article or add new information about this topic:
- Abstracts: A discrete stochastic model for investment with an application to the transaction costs case. Optimal investment with taxes: An existence result
- Abstracts: Detection of regime switches between stationary and nonstationary processes and economic forecasting. Statistical surveillance of cyclical processes with application to turns in business cycles
- Abstracts: A root-n consistent semiparametric estimator for related-effect binary response panel data. On the differential geometry of the Wald test with nonlinear restrictions
- Abstracts: Trading bargaining weights. A remark on rational expectation equilibria with incomplete markets and real assets