Learning, heterogeneity, and complexity in the New Keynesian model
(2019)
Journal Article
Calvert Jump, R., Hommes, C., & Levine, P. (2019). Learning, heterogeneity, and complexity in the New Keynesian model. Journal of Economic Behavior and Organization, 166, 446-470. https://doi.org/10.1016/j.jebo.2019.07.014
We present a New Keynesian model in which a fraction n of agents are fully rational, and a fraction 1 − n of agents are bounded rational. After deriving a simple reduced form, we demonstrate that the Taylor condition is sufficient for determinacy and... Read More about Learning, heterogeneity, and complexity in the New Keynesian model.