IDEAS home Printed from https://ideas.repec.org/a/mes/postke/v43y2020i1p76-89.html
   My bibliography  Save this article

Dealing with adaptive expectations in Stock-Flow consistent models

Author

Listed:
  • Sylvio Antonio Kappes
  • Marcelo Milan

Abstract

Stock-flow consistent (SFC) models, in their simulations of the macroeconomic dynamics, have not properly dealt with how households form their expectations about future income flows. Although the majority of SFC models assume some type of adaptive expectations, the literature has not provided so far guidelines about how to best model expected variables in general, and expect flows of income in consumption decisions in particular, thus not paying enough attention to the role of expectations in affecting the path of variables and the steady-state composition of stocks. In this article, which compares different types of modeling strategies for income expectations, it is shown that minor differences in the way that expectations are modeled may have important macroeconomic consequences, mainly in terms of the traverse and the steady-state composition of wealth.

Suggested Citation

  • Sylvio Antonio Kappes & Marcelo Milan, 2020. "Dealing with adaptive expectations in Stock-Flow consistent models," Journal of Post Keynesian Economics, Taylor & Francis Journals, vol. 43(1), pages 76-89, January.
    • Handle: RePEc:mes:postke:v:43:y:2020:i:1:p:76-89
    DOI: 10.1080/01603477.2019.1640067
    as

    Download full text from publisher

    File URL: http://hdl.handle.net/10.1080/01603477.2019.1640067
    Download Restriction: Access to full text is restricted to subscribers.
    File URL: https://libkey.io/10.1080/01603477.2019.1640067?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Glötzl, Erhard, 2022. "General Constrained Dynamic (GCD) models with intertemporal utility functions," MPRA Paper 112387, University Library of Munich, Germany.
    2. Meijers, Huub & Muysken, Joan & Piccillo, Giulia, 2023. "Expectations and the stability of stock-flow consistent models," MERIT Working Papers 2023-024, United Nations University - Maastricht Economic and Social Research Institute on Innovation and Technology (MERIT).

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:mes:postke:v:43:y:2020:i:1:p:76-89. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Chris Longhurst (email available below). General contact details of provider: http://www.tandfonline.com/MPKE20 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.