Inferential expectations

We propose that the formation of beliefs be treated as statistical hypothesis tests, and we label such beliefs inferential expectations. If a belief is overturned through the build-up of evidence, agents are assumed to switch to the rational expectation. Thus, rational expectations is a special case...

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Bibliographic Details
Main Authors: Menzies, G, Zizzo, D
Format: Working paper
Published: University of Oxford 2004