Coordination through social learning in a general equilibrium model
Language
EN
Article de revue
This item was published in
Journal of Economic Behavior and Organization. 2017-09-01, vol. 141, p. 64-82
English Abstract
This paper analyses coordination through social learning in a general equilibrium model. We use a fully decentralized economy, in which households and firms exchange labour and consumption goods in the corresponding markets ...Read more >
This paper analyses coordination through social learning in a general equilibrium model. We use a fully decentralized economy, in which households and firms exchange labour and consumption goods in the corresponding markets with potential rationing. Their strategies are updated through an evolutionary learning process based on imitation and random experimenting. This learning process induces substantial coordination failures, especially between firms, which lead almost systematically to below equilibrium output levels and social welfare losses. The main underlying mechanism is a self-reinforcing uneven distribution of households’ income, which results in a lack of aggregate demand.Read less <
English Keywords
Evolutionary learning
General equilibrium
Heterogeneous agents
Income distribution