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- W1966840007 abstract "Abstract This paper presents a dynamic model in which pessimistic expectations cause an atomistic economy with flexible prices to get stuck ‘near’ a set of inferior equilibria. The economy involves labor and several flow outputs, households which are identical, competitive utility maximizers and firms which are atomistic profit maximizers. Firms formulate point sales expectations which adjust adaptively. Prices adjust in response to (possibly expectations-constrained) excess demands. In relative price terms, a unique Pareto-optimal equilibrium and non-denumerably many Pareto-inferior equilibria exist. Under various initial conditions involving prices and expectations, every limit point of the economy's trajectory is an inferior equilibrium." @default.
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- W1966840007 date "1982-11-01" @default.
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- W1966840007 title "Inferior equilibria in a pure flow model with adaptive expectations" @default.
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- W1966840007 doi "https://doi.org/10.1016/0165-1889(82)90005-7" @default.
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