Barro-Gordon revisited: Reputational equilibria with inferential expectations
- Elsevier Inc
- Publication Type:
- Journal Article
- Economics Letters, 2011, 112 (2), pp. 144 - 147
- Issue Date:
We incorporate inferential expectations into the BarroGordon model (Barro and Gordon, 1983a) of time inconsistency and consider reputational equilibria. The range of sustainable equilibria shrinks as the private sector becomes more belief-conservative.
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