We analyze a rational-expectations model of price formation in an intermediate-good market under uncertainty. There is a continuum of firms, each consisting of a party who can reduce production cost ...

This is a preview. Log in through your library . Abstract A step toward a strategic foundation for rational expectations equilibrium is taken by considering a double auction with n buyers and m ...

Carla Tardi is a technical editor and digital content producer with 25+ years of experience at top-tier investment banks and money-management firms. The rational expectations theory is a concept and ...

This study explores the macroeconomic implications of adaptive expectations in a standard growth model. We show that the self-confirming equilibrium under adaptive expectations is the same as the ...

We propose a theoretical argument for a new rational expectations equilibrium hypothesis in the intergenerational economy, where each generation is intergenerationally altruistic and rational. The ...

Using long-run cross-country panel data, we document that (i) contemporaneous credit growth strongly predicts contemporaneous equity returns with positive sign, and (ii) lagged credit growth strongly ...