A Note on "Stability of Tâtonnement Processes of Short Period Equilibria with Rational Expectations"

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Abstract

In Hens (1997), a new adjustment process is proposed for a setting with reopening spot and asset markets. He argues by means of an intemporal variant of Scarf's example that this process is more stable than the other processes, although in general it might be more stable or less stable. This note gives further evidence showing that Hens's process is indeed more stable. The results contradict some of the arguments of Hens (1997), which are corrected.
Original languageEnglish
Place of PublicationTilburg
PublisherMicroeconomics
Number of pages5
Volume1997-110
Publication statusPublished - 1997

Publication series

NameCentER Discussion Paper
Volume1997-110

Keywords

  • Tatonnement
  • stability
  • rational expectations
  • general equilibrium

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