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[1] [[PS05]](https://python-programming.quantecon.org/zreferences.html#pearlman-sargent2005) verified this assertion using a different tactic, namely, by constructing\n", "analytic formulas an equilibrium under the incomplete\n", "information structure and confirming that they match the pooling equilibrium formulas derived here.\n", "\n", "
[2] See [[AHMS96]](https://python-programming.quantecon.org/zreferences.html#ahms) for an account of invariant subspace methods.\n", "\n", "
[3] See [[AHMS96]](https://python-programming.quantecon.org/zreferences.html#ahms) for a discussion\n", "of the information assumptions needed to create a situation\n", "in which higher order beliefs appear in equilibrium decision rules. The way\n", "to read our findings in light of [[AMS02]](https://python-programming.quantecon.org/zreferences.html#ams) is that Townsend’s\n", "section 8 model has too few sources of random shocks relative\n", "to sources of signals to permit higher order beliefs to\n", "play a role.\n", "\n", "
[4] See [[Sar87]](https://python-programming.quantecon.org/zreferences.html#sargent1987), especially\n", "chapters IX and XIV, for the principles that guide solving some roots backwards and others forwards.\n", "\n", "
[5] As noted [[Sar87]](https://python-programming.quantecon.org/zreferences.html#sargent1987), this difference equation is the Euler equation for\n", "the planning problem of maximizing the discounted sum of consumer plus\n", "producer surplus.\n", "\n", "
[6] [[PS05]](https://python-programming.quantecon.org/zreferences.html#pearlman-sargent2005) verify the same claim by applying machinery of [[PCL86]](https://python-programming.quantecon.org/zreferences.html#pcl)." ] } ], "metadata": { "date": 1624431174.2590406, "filename": "knowing_forecasts_of_others.rst", "kernelspec": { "display_name": "Python", "language": "python3", "name": "python3" }, "next_doc": { "link": "index_asset_pricing", "title": "Asset Pricing and Finance" }, "prev_doc": { "link": "classical_filtering", "title": "Classical Prediction and Filtering With Linear Algebra" }, "title": "Knowing the Forecasts of Others" }, "nbformat": 4, "nbformat_minor": 2 }