Expectations play a central role in modern macroeconomic theories. The econometric
learning approach models economic agents as forming expectations by estimating and …

Empirical evidence shows that most exchange rate volatility at short to medium horizons is
related to order flow and not to macroeconomic variables. We introduce symmetric …

We introduce the concept of Misspecification Equilibrium to dynamic macroeconomics.
Agents choose between a list of misspecified econometric models and base their selection …

We review the recent work on interest rate setting, which emphasizes the desirability of
designing policy to ensure stability under learning. Appropriately designed expectations …

The recent macroeconomic literature stresses the importance of managing heterogeneous
expectations in the formulation of monetary policy. We use a simple frictionless dynamic …

This chapter provides an overview of recent models of heterogeneous expectations in
macroeconomics. We begin with a description of household behavior in an environment with …

We show how monetary policy inertia can help alleviate problems of indeterminacy and non‐
existence of stationary equilibrium observed for some commonly studied monetary policy …

Expectations play a central role in modern macroeconomics. Economic agents are assumed
to be dynamic optimizers whose current economic decisions are the first stage of a dynamic …

Expectations about the future are central for determination of current macroeconomic
outcomes and the formulation of monetary policy. Recent literature has explored ways for …

We analyse the effects of social learning in a monetary policy context. Social learning might
be viewed as more descriptive of actual learning behaviour in complex market economies …