Intertemporal coordination in two-period markets
Ghosal, Sayantan. (2006) Intertemporal coordination in two-period markets. JOURNAL OF MATHEMATICAL ECONOMICS, 43 (1). pp. 11-35. ISSN 0304-4068Full text not available from this repository.
Official URL: http://dx.doi.org/10.1016/j.jmateco.2006.07.003
This paper studies the stability of the intertemporal coordination dynamics when the common knowledge of individual expectations of future prices is perturbed in a neighborhood of a perfect foresight equilibrium. The main forces that affect stability are: (i) the effect of a change in asset demand on second period spot market prices, and (ii) the effect on asset demand of a small change in second period prices. In an intertemporal market game whose interior Markov perfect equilibria correspond to perfect foresight equilibria, it is shown that though M-rationalizability implies the stability of the intertemporal dynamics, the converse is not always true. (c) 2006 Elsevier B.V. All rights reserved.
|Item Type:||Journal Article|
|Subjects:||H Social Sciences > HC Economic History and Conditions
Q Science > QA Mathematics
H Social Sciences
|Journal or Publication Title:||JOURNAL OF MATHEMATICAL ECONOMICS|
|Publisher:||ELSEVIER SCIENCE SA|
|Official Date:||December 2006|
|Number of Pages:||25|
|Page Range:||pp. 11-35|
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