Overlapping Generations Models of General Equilibrium

The OLG model of Allais and Samuelson retains the methodological assumptions of agent optimization and market clearing from the Arrow-Debreu model, yet its equilibrium set has different properties: Pareto inefficiency, indeterminacy, positive valuation of money, and a golden rule equilibrium in which the rate of interest is equal to population growth (independent of impatience). These properties are shown to derive not from market incompleteness, but from lack of market clearing "at infinity;" they can be eliminated with land or uniform impatience. The OLG model is used to analyze bubbles, social security, demographic effects on stock returns, the foundations of monetary theory, Keynesian vs. real business cycle macromodels, and classical vs. neoclassical disputes.Demography, Inefficiency, Indeterminacy, Money, Bubbles, Cycles, Rate of interest, Impatience, Land, Infinity, Expectations, Social security, Golden rule

The algebraic geometry of perfect and sequential equilibrium: an extension

We extend the generic equivalence result of Blume and Zame (Econometrica 62: 783-794, 1994) to a broader context of perfectly and sequentially rational strategic behavior (including equilibrium and nonequilibrium behavior) through a unifying solution concept of "mutually acceptable course of action" (MACA) proposed by Greenberg et al. (2009). As a by-product, we show, in the affirmative, Dekel et al.'s (1999) conjecture on the generic equivalence between the sequential and perfect versions of rationalizable self-confirming equilibrium. JEL Classification: C70, C7

Three Essays on Epistemic Game Theory

Ph.DDOCTOR OF PHILOSOPH

Overlapping Generations Models of General Equilibrium

The OLG model of Allais and Samuelson retains the methodological assumptions of agent optimization and market clearing from the Arrow-Debreu model, yet its equilibrium set has different properties: Pareto inefficiency, indeterminacy, positive valuation of money, and a golden rule equilibrium in which the rate of interest is equal to population growth (independent of impatience). These properties are shown to derive not from market incompleteness, but from lack of market clearing “at infinity;” they can be eliminated with land or uniform impatience. The OLG model is used to analyze bubbles, social security, demographic effects on stock returns, the foundations of monetary theory, Keynesian vs. real business cycle macromodels, and classical vs. neoclassical disputes

What's a face worth: Noneconomic factors in game playing

Where behavior defies economic analysis, one explanation is that individuals consider more than the immediate payoff. We present evidence that noneconomic factors influence behavior. Attractiveness influences offers in the Ultimatum and Dictator Games. Facial resemblance, a cue of relatedness, increases trusting in a two-node trust game. Only by considering the range of possible influences will game-playing behavior be explained

Uncomputability and Undecidability in Economic Theory

Economic theory, game theory and mathematical statistics have all increasingly become algorithmic sciences. Computable Economics, Algorithmic Game Theory ([28]) and Algorithmic Statistics ([13]) are frontier research subjects. All of them, each in its own way, are underpinned by (classical) recursion theory - and its applied branches, say computational complexity theory or algorithmic information theory - and, occasionally, proof theory. These research paradigms have posed new mathematical and metamathematical questions and, inadvertently, undermined the traditional mathematical foundations of economic theory. A concise, but partial, pathway into these new frontiers is the subject matter of this paper. Interpreting the core of mathematical economic theory to be defined by General Equilibrium Theory and Game Theory, a general - but concise - analysis of the computable and decidable content of the implications of these two areas are discussed. Issues at the frontiers of macroeconomics, now dominated by Recursive Macroeconomic Theory, are also tackled, albeit ultra briefly. The point of view adopted is that of classical recursion theory and varieties of constructive mathematics.General Equilibrium Theory, Game Theory, Recursive Macro-economics, (Un)computability, (Un)decidability, Constructivity

An overview of lexicographic choice under uncertainty

This overview focuses on lexicographic choice under conditions of uncertainty. First, lexicographic versions of traditional (von Neumann-Morgenstern) expected utility theory are described where the usual Archimedean axiom is weakened. The role of these lexicographic variants in explaining some well-known “paradoxes” of choice theory is reviewed. Next, the significance of lexicographic choice for game theory is discussed. Finally, some lexicographic extensions of the classical maximin decision rule are described.Peer Reviewedhttp://deepblue.lib.umich.edu/bitstream/2027.42/44147/1/10479_2005_Article_BF02283523.pd