George W. Evans

Learn More
We introduce the concept of a Misspecification Equilibrium to dynamic macroeconomics. A Misspecification Equilibrium occurs in a stochastic process when agents forecast optimally given that they must choose from a list of misspecified econometric models. With appropriate restrictions on the asymp-totic properties of the exogeneous process and on the(More)
We examine local strong rationality (LSR) in multivariate models with both forward-looking expectations and predetermined variables. Given hypothetical common knowledge restrictions that the dynamics will be close to those of a specified minimal state variable solution, we obtain eductive stability conditions for the solution to be LSR. In the saddlepoint(More)
  • 1