IDEAS home Printed from https://ideas.repec.org/p/osf/osfxxx/xsemj_v1.html
   My bibliography  Save this paper

Cobweb Theory, Market Stability and Price Expectations

Author

Listed:
  • Poitras, Geoffrey

Abstract

Contributors to cobweb theory include many leading economists of the 20th century. From early beginnings in 1930, cobweb theory played a key role in evolving perceptions of market stability arising from recursive linear models with endogenous dynamics. The focal point of this evolution in cobweb theory is the transition from naive to adaptive to rational price expectations. After a review of the pre-history, this paper examines the first wave of linear cobweb theory initiated by Tinbergen, Schultz and Ricci and proceeds to consider the evolution of price expectations in the second wave of cobweb models associated with endogenous cycles in commodity markets. Finally, the role of modern cobweb theory in discussions surrounding the stability of market equilibrium and the connection to processes with rational expectations is assessed.

Suggested Citation

  • Poitras, Geoffrey, 2022. "Cobweb Theory, Market Stability and Price Expectations," OSF Preprints xsemj_v1, Center for Open Science.
    • Handle: RePEc:osf:osfxxx:xsemj_v1
    DOI: 10.31219/osf.io/xsemj_v1
    as

    Download full text from publisher

    File URL: https://osf.io/download/62519e509e3fb8133ca571ec/
    Download Restriction: no
    File URL: https://libkey.io/10.31219/osf.io/xsemj_v1?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
    ---><---

    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:osf:osfxxx:xsemj_v1. 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: OSF (email available below). General contact details of provider: https://osf.io/preprints/ .

    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.