Coherence without rationality at the zero lower bound

• 成果类型: Article
• 署名作者: Ascari, Guido; Mavroeidis, Sophocles; Mcclung, Nigel
• 署名单位: University of Pavia; European Central Bank; De Nederlandsche Bank NV; University of Oxford; Bank of Finland; University of Pavia
• 刊物名称: JOURNAL OF ECONOMIC THEORY
• ISSN/ISSBN: 0022-0531
• DOI: 10.1016/j.jet.2023.105745
• 发表日期: 2023
• 关键词: Incompleteness; Incoherence; expectations; zero lower bound

摘要

Standard rational expectations models with an occasionally binding zero lower bound constraint either admit no solutions (incoherence) or multiple solutions (incompleteness). This paper shows that deviations from full-information rational expectations mitigate concerns about incoherence and incompleteness. Mod-els with no rational expectations equilibria admit self-confirming equilibria involving the use of simple mis-specified forecasting models. Completeness and coherence are restored if expectations are adaptive or if agents are less forward-looking due to some information or behavioral friction. In the case of incomplete-ness, the E-stability criterion selects an equilibrium.(c) 2023 The Author(s). Published by Elsevier Inc. This is an open access article under the CC BY license (http://creativecommons .org /licenses /by /4 .0/).