Hostname: page-component-586b7cd67f-vdxz6 Total loading time: 0 Render date: 2024-11-28T06:41:37.321Z Has data issue: false hasContentIssue false
  • English
  • Français

CONSISTENT EXPECTATIONS EQUILIBRIA AND COMPLEX DYNAMICS IN RENEWABLE RESOURCE MARKETS

Published online by Cambridge University Press:  25 May 2001

Cars H. Hommes  and
J. Barkley Rosser,
Cars H. Hommes
Affiliation:
University of Amsterdam
J. Barkley Rosser,
Affiliation:
James Madison University
Get access Rights & Permissions [Opens in a new window]

Abstract

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 backward more to generate multiple steady-state rational expectations equilibria. Under bounded rationality, adaptive learning of a linear forecasting rule generates steady-state, two-cycle as well as chaotic consistent expectations equilibria, 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.

Keywords

Bounded RationalityAdaptive LearningCobweb DynamicsChaosOptimal Resource ManagementFishery Model
Type
Research Article
Information
Macroeconomic Dynamics , Volume 5 , Issue 02 , April 2001 , pp. 180 - 203
Copyright
© 2001 Cambridge University Press

Access options

Get access to the full version of this content by using one of the access options below. (Log in options will check for institutional or personal access. Content may require purchase if you do not have access.)