Random perturbations of deterministic equilibria
Article Abstract:
A study is done on small random deviation from a non-random policy process that may destabilize the equilibrium exchange rate focusing on exchange rate dynamics when a target zone is maintained or the unanticipated deviations from a policy rule is made by the government. Large deviations from the policy rule exchange rates are not created by small random shocks with rational expectations.
Publication Name: Journal of Economic Theory
Subject: Economics
ISSN: 0022-0531
Year: 2003
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A geometric approach to sunspot equilibria
Article Abstract:
A first order sunspot equilibra in a class of nonlinear dynamic economic models without predetermined variables is analysed. It is shown that such stochastic equilibria exist around a steady state whenever it is locally indeterminate.
Publication Name: Journal of Economic Theory
Subject: Economics
ISSN: 0022-0531
Year: 2001
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On the consistency of stationary Markov equilibria with an exogenous distribution
Article Abstract:
A technique to show the existence of stationary Markov equilibria is provided. The consistency of a stationary Markov equilibria with an exogenous distribution is discussed.
Publication Name: Journal of Economic Theory
Subject: Economics
ISSN: 0022-0531
Year: 2003
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