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The Simonian bounded rationality hypothesis and the expectation formation mechanism

The Simonian bounded rationality hypothesis and the expectation formation mechanism <jats:p>In the 1980s and at beginning of the 1990s the debate on expectation formation mechanism was dominated by the rational expectation hypothesis. Later on, more interest was directed towards alternative approaches to expectations analysis, mainly based on the bounded rationality paradigm introduced earlier by Herbert A. Simon. The bounded rationality approach is used here to describe the way expectations might be formed by different agents. Furthermore, three main hypotheses, namely adaptive, rational and bounded ones are being compared and used to indicate why time lags in economic policy prevail and are variable. (original abstract)</jats:p> http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png Economics and Business Review CrossRef

The Simonian bounded rationality hypothesis and the expectation formation mechanism

Economics and Business Review , Volume 2 (1): 5-24 – Jun 30, 2002

The Simonian bounded rationality hypothesis and the expectation formation mechanism


Abstract

<jats:p>In the 1980s and at beginning of the 1990s the debate on expectation formation mechanism was dominated by the rational expectation hypothesis. Later on, more interest was directed towards alternative approaches to expectations analysis, mainly based on the bounded rationality paradigm introduced earlier by Herbert A. Simon. The bounded rationality approach is used here to describe the way expectations might be formed by different agents. Furthermore, three main hypotheses, namely adaptive, rational and bounded ones are being compared and used to indicate why time lags in economic policy prevail and are variable. (original abstract)</jats:p>

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Publisher
CrossRef
ISSN
2450-0097
DOI
10.18559/ebr.2002.1.485
Publisher site
See Article on Publisher Site

Abstract

<jats:p>In the 1980s and at beginning of the 1990s the debate on expectation formation mechanism was dominated by the rational expectation hypothesis. Later on, more interest was directed towards alternative approaches to expectations analysis, mainly based on the bounded rationality paradigm introduced earlier by Herbert A. Simon. The bounded rationality approach is used here to describe the way expectations might be formed by different agents. Furthermore, three main hypotheses, namely adaptive, rational and bounded ones are being compared and used to indicate why time lags in economic policy prevail and are variable. (original abstract)</jats:p>

Journal

Economics and Business ReviewCrossRef

Published: Jun 30, 2002

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