Rules of thumb in macroeconomic equilibrium a quantitative analysis

Journal of Economic Dynamics and Control

Volumn 20, Issue 4, 1996, Pages 527-558

  Krusell, Per ^a,b   Smith Jr , Anthony A ^c  

^a UNIVERSITY OF ROCHESTER   (United States)

^b STOCKHOLM UNIVERSITY   (Sweden)

^c CARNEGIE MELLON UNIVERSITY   (United States)

Author keywords

Decentralized decision making; Robustness; Rules of thumb; Stochastic growth model

Indexed keywords

EID: 0030117227     PISSN: 01651889     EISSN: None     Source Type: Journal    
DOI: 10.1016/0165-1889(95)00863-2     Document Type: Article

References (29)

1. Akerlof, G.A. and J.L. Yellen, 1985a, Can small deviations from rationality make significant differences to economic equilibria?, American Economic Review 75, 823-838.
2. Akerlof, G.A. and J.L. Yellen, 1985b, A near-rational model of the business cycle, with wage and price inertia, Quarterly Journal of Economics 100, Suppl., 823-838.
3. Aumann, R., 1992, Perspectives on bounded rationality, in: Y. Moses, ed., Theoretical aspects of reasoning about knowledge: Proceedings of the fourth conference (TARK 1992), Manuscript (Weizmann Institute, Jerusalem).
4. Brock, W.A. and L.J. Mirman 1972, Optimal economic growth and uncertainty: The discounted case, Journal of Economic Theory 4, 479-513.
5. Caballero, R.J., 1991, Fuzzy preferences and aggregate consumption, Discussion paper no. 520 (Columbia University, New York, NY).
6. Campbell, J.Y. and N.G. Mankiw, 1990, Permanent income, current income, and consumption, Journal of Business and Economic Statistics 8, 265-279.
7. Christiano, L.J., 1990, Linear-quadratic approximation and value-function iteration, Journal of Business and Economic Statistics 8, 99-113.
8. Cochrane, J.H., 1989, The sensitivity of tests of the intertemporal allocation of consumption to near-rational alternatives, American Economic Review 79, 319-337.
9. Crettez, B. and P. Michel, 1990, Economically rational expectations equilibrium, Discussion paper no. 9055 (CORE, Louvain-la-Neuve).
10. Díaz-Giménez, J., E.C. Prescott, T. Fitzgerald, and F. Alvarez, 1992, Banking in computable general equilibrium economies, Journal of Economic Dynamics and Control 16, 533-559.
11. De Long, J.B., A. Shleifer, L.H. Summers, and R.J. Waldmann, 1990, Noise trader risk in financial markets, Journal of Political Economy 98, 703-738.
12. Evans, G.W. and S. Honkapohja, 1993, Adaptive learning and expectational stability: An introduction, in: A. Kirman and M. Salmon, eds., Learning and rationality in economics (Basil Blackwell, Oxford).
13. Evans, G.W. and G. Ramey, 1992, Expectation calculation and macroeconomic dynamics, American Economic Review 82, 207-224.
14. Haltiwanger, J. and M. Waldman, 1985, Rational expectations and the limits of rationality: An analysis of heterogeneity, American Economic Review 75, 326-340.
15. Haltiwanger, J. and M. Waldman, 1991, Responders versus non-responders: A new perspective on heterogeneity, Economic Journal 101, 1085-1102.
16. Hansen, G.D. and R. Wright, 1992, The labor market in real business cycle theory, Federal Reserve Bank of Minneapolis Quarterly Review, 2-12.
17. Hurwicz, L., S. Reiter, and D. Saari, 1994, Computational complexity and communication in resource allocation mechanisms (Cambridge University Press, Cambridge, under contract).
18. Imrohoroǧlu, S., 1989, The cost of business cycles with indivisibilities and liquidity constraints, Journal of Political Economy 97, 1364-1383.
19. Ingram, B.F., 1990, Equilibrium modeling of asset prices: Rationality versus rules of thumb, Journal of Business and Economic Statistics 8, 115-126.
20. Lipman, B.L., 1991, How to decide how to decide how to ... : Modeling limited rationality, Econometrica 59, 1105-1126.
21. Lucas, R.E. Jr., 1987, Models of business cycles (Basil Blackwell, New York, NY).
22. Mirrlees, J.A. and N.H. Stern, 1972, Fairly good plans, Journal of Economic Theory 4, 268-288.
23. Rosenthal, R.W., 1991, Rules of thumb in games, Manuscript (Boston University, Boston, MA).
24. Sargent, T.J., 1992, Bounded rationality in macroeconomics, Manuscript (Hoover Institution, Stanford, CA; University of Chicago, Chicago, IL).
25. Smith, A.A., Jr., 1990, Three essays on the solution and estimation of dynamic macroeconomic models, Unpublished Ph.D. thesis (Duke University, Durham, NC).
26. Smith, A.A., Jr., 1992, Near-rational behavior and the real business cycle, Manuscript (Carnegie Mellon University, Pittsburgh, PA).
27. Solow, Robert M., 1956, A contribution to the theory of economic growth, Quarterly Journal of Economics 70, 65-94.
28. Stokey, N.L. and R.E. Lucas, Jr., with E.C. Prescott, 1989, Recursive methods in economic dynamics (Harvard University Pres, Cambridge, MA).
29. Weil, P., 1991, Hand-to-mouth consumers and asset prices, Discussion paper no. 1562 (Harvard Institute of Economic Research, Cambridge, MA).