Consistent Expectations Equilibria And Complex Dynamics In Renewable Resource Markets
Price fluctuations under adaptive learning in renewable resource markets such as fisheries are examined. Optimal fishery management with logistic fish population growth implies a backward-bending, discounted supply curve for bioeconomic equilibrium sustained yield. Higher discount rates bend supply backwards more to generate multiple steady state rational expectations equilibria. Under bounded rationality adaptive learning of a linear forecasting rule generates steady state, 2-cycle as well as chaotic consistent expectations equilibria (CEE), which are self-fulfilling in sample average and autocorrelations. The possibility of "learning to believe in chaos" is robust and even enhanced by dynamic noise.
(This abstract was borrowed from another version of this item.)
Volume (Year): 5 (2001)
Issue (Month): 02 (April)
|Contact details of provider:|| Postal: |
Web page: http://journals.cambridge.org/jid_MDY
References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Jean-Michel Grandmont, 1997.
"Expectations Formation and Stability of Large Socioeconomic Systems,"
97-27, Centre de Recherche en Economie et Statistique.
- Jean-Michel Grandmont, 1998. "Expectations Formation and Stability of Large Socioeconomic Systems," Econometrica, Econometric Society, vol. 66(4), pages 741-782, July.
- Grandmont, Jean-Michel, 1994. "Expectations formation and stability of large socioeconomic systems," CEPREMAP Working Papers (Couverture Orange) 9424, CEPREMAP.
- GRANDMONT, Jean-Michel, 1997. "Expectations formation and stability of large socioeconomic systems," CORE Discussion Papers 1997088, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
- Mitra, Tapan, 1998. "On the relationship between discounting and complicated behavior in dynamic optimization models," Journal of Economic Behavior & Organization, Elsevier, vol. 33(3-4), pages 421-434, January.
- Sorger, Gerhard, 1998. "Imperfect foresight and chaos: an example of a self-fulfilling mistake," Journal of Economic Behavior & Organization, Elsevier, vol. 33(3-4), pages 363-383, January.
- James Bullard & John Duffy, 1999.
"Learning and Excess Volatility,"
Computing in Economics and Finance 1999
224, Society for Computational Economics.
- J. Barkley Rosser, Jr., 1995. "Systemic Crises in Hierarchical Ecological Economies," Land Economics, University of Wisconsin Press, vol. 71(2), pages 163-172.
- Schonhofer, Martin, 2001. "Can agents learn their way out of chaos?," Journal of Economic Behavior & Organization, Elsevier, vol. 44(1), pages 71-83, January.
- Arifovic, Jasmina, 1996. "The Behavior of the Exchange Rate in the Genetic Algorithm and Experimental Economies," Journal of Political Economy, University of Chicago Press, vol. 104(3), pages 510-41, June.
- Marcet, Albert & Sargent, Thomas J., 1989. "Convergence of least squares learning mechanisms in self-referential linear stochastic models," Journal of Economic Theory, Elsevier, vol. 48(2), pages 337-368, August.
- James Bullard, 1991.
1991-004, Federal Reserve Bank of St. Louis.
- Sargent, Thomas J., 1993. "Bounded Rationality in Macroeconomics: The Arne Ryde Memorial Lectures," OUP Catalogue, Oxford University Press, number 9780198288695, March.
- Chiarella, Carl, 1988. "The cobweb model: Its instability and the onset of chaos," Economic Modelling, Elsevier, vol. 5(4), pages 377-384, October.
- Hommes, Cars H., 1998. "On the consistency of backward-looking expectations: The case of the cobweb," Journal of Economic Behavior & Organization, Elsevier, vol. 33(3-4), pages 333-362, January.
- Schonhofer, Martin, 1999. "Chaotic Learning Equilibria," Journal of Economic Theory, Elsevier, vol. 89(1), pages 1-20, November.
- Hommes, Cars H., 1994. "Dynamics of the cobweb model with adaptive expectations and nonlinear supply and demand," Journal of Economic Behavior & Organization, Elsevier, vol. 24(3), pages 315-335, August.
- Chavas, Jean-Paul & Holt, Matthew T., 1995. "Nonlinear Dynamics And Economic Instability: The Optimal Management Of A Biological Population," Journal of Agricultural and Resource Economics, Western Agricultural Economics Association, vol. 20(02), December.
- Hommes, Cars & Sorger, Gerhard, 1998. "Consistent Expectations Equilibria," Macroeconomic Dynamics, Cambridge University Press, vol. 2(03), pages 287-321, September.
- Radunskaya, Amy, 1994. "Comparing Random and Deterministic Time Series," Economic Theory, Springer, vol. 4(5), pages 765-76, August.
- Montrucchio, Luigi & Sorger, Gerhard, 1996. "Topological entropy of policy functions in concave dynamic optimization models," Journal of Mathematical Economics, Elsevier, vol. 25(2), pages 181-194.
- H. Scott Gordon, 1954. "The Economic Theory of a Common-Property Resource: The Fishery," Journal of Political Economy, University of Chicago Press, vol. 62, pages 124.
- Nishimura, Kazuo & Yano, Makoto, 1996. "On the Least Upper Bound of Discount Factors That Are Compatible with Optimal Period-Three Cycles," Journal of Economic Theory, Elsevier, vol. 69(2), pages 306-333, May.
When requesting a correction, please mention this item's handle: RePEc:cup:macdyn:v:5:y:2001:i:02:p:180-203_01. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Keith Waters)
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.