Stable Finite-State Markov Sunspots
| dc.contributor.author | Evans, George W., 1949- | |
| dc.contributor.author | McGough, Bruce | |
| dc.date.accessioned | 2006-11-21T17:35:06Z | |
| dc.date.available | 2006-11-21T17:35:06Z | |
| dc.date.issued | 2006-10-09 | |
| dc.description | 45 p. Revision of: Stable noisy K-state Markov Sunspots. | en |
| dc.description.abstract | We consider a linear univariate rational expectations model, with a predetermined variable, and study existence and stability of solutions driven by an extraneous finite-state Markov process. We show that when the model is indeterminate there exists a new class of kstate dependent sunspot equilibria in addition to the k-state sunspot equilibria (k-SSEs) already known to exist in part of the indeterminacy region. The new type of equilibria, which we call ergodic k-SSEs, are driven by a finite-state sunspot but can have an infinite range of values even in the nonstochastic model. Stability under econometric learning is analyzed using representations that nest both types of equilibria. 2-SSEs and ergodic 2-SSEs are learnable for parameters in proper subsets of the regions of their existence. Our results extend to models with intrinsic random shocks. | en |
| dc.format.extent | 761525 bytes | |
| dc.format.mimetype | application/pdf | |
| dc.identifier.uri | https://hdl.handle.net/1794/3632 | |
| dc.language.iso | en_US | en |
| dc.publisher | University of Oregon, Dept of Economics | en |
| dc.relation.ispartofseries | University of Oregon Economics Department Working Papers ; 2006-13 | en |
| dc.subject | Markov sunspots | en |
| dc.subject | Learning | en |
| dc.subject | Indeterminacy | en |
| dc.subject | Expectational stability | en |
| dc.title | Stable Finite-State Markov Sunspots | en |
| dc.type | Working Paper | en |