Recommended Citation
Velupillai, K.V., (2005) "Reappraising Fix-Point Formalizations of Rational Expectations Equilibria" (Working Paper No. 0096) Department of Economics, National University of Ireland, Galway.
Abstract
The paper begins with a brief introduction to the origins of the tradition of formalizing the determination of a rational expectations equilibrium using topological fix points. It is then suggested that fidelity to the twin economic conceptual bases of rational expectations - self-reference and infinite regress - are not encapsulated in the topological formalism. To remedy this defect, a recursion theoretic formalism for modelling rational expectations equilibria is developed.