Non-implementation of Rational Expectations as a Perfect Bayesian Equilibrium

Abstract: We show that a rational expectations equilibrium need not be incentive compatible, need not be implementable as a perfect Bayesian equilibrium and may not be fully Pareto optimal, unless the utility functions are state independent. A comparison of rational expectations equilibria with core...

Ausführliche Beschreibung

Bibliographische Detailangaben
Link(s) zu Dokument(en):IHS Publikation
Hauptverfasser: Glycopantis, Dionysius, Muir, Allan, Yannelis, Nicholas C.
Format: IHS Series NonPeerReviewed
Sprache:Englisch
Veröffentlicht: Institut für Höhere Studien 2004
Beschreibung
Zusammenfassung:Abstract: We show that a rational expectations equilibrium need not be incentive compatible, need not be implementable as a perfect Bayesian equilibrium and may not be fully Pareto optimal, unless the utility functions are state independent. A comparison of rational expectations equilibria with core concepts is also provided.;

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