Title: Anticipated Fiscal Policy and Adaptive Learning
Abstract: We consider the impact of anticipated policy changes when agents form expectations using adaptive learning rather than rational expectations. To model this we assume that agents combine limited structural knowledge with a standard adaptive learning rule. We analyze these issues using two well-known set-ups, an endowment economy and the Ramsey model. In our set-up there are important deviations from both rational expectations and purely adaptive learning. Our approach could be applied to many macroeconomic frameworks.
Publication Year: 2007
Publication Date: 2007-08-15
Language: en
Type: preprint
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Cited By Count: 1
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