Since 2014
The Source of Time Inconsistency in Optimal Plans
Philippine Review of Economics
View Archive Info| Field | Value | |
| Title |
The Source of Time Inconsistency in Optimal Plans
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| Creator |
Encarnacion, Jr., Jose; University Professor, University of the Philippines
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| Subject |
—
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| Description |
Kydland-Prescott (1977) and Calvo (1978) have argued that optimal dynamic plans are time inconsistent in general. It is shown that their demonstrations of this proposition are not valid. However, the proposition is correct because a later optimization problem always drops some condition required of the original plan. When that condition is not satisfied by, since not required of, the solution to the later problem, the result is time inconsistency.
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| Publisher |
Philippine Review of Economics
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| Contributor |
—
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| Date |
1993-12-24
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| Type |
info:eu-repo/semantics/article
info:eu-repo/semantics/publishedVersion Peer-reviewed Article |
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| Format |
application/pdf
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| Identifier |
http://www.econ.upd.edu.ph/pre/index.php/pre/article/view/142
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| Source |
Philippine Review of Economics; Vol 30, No 2 (1993)
1655-1516 |
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| Language |
eng
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| Relation |
http://www.econ.upd.edu.ph/pre/index.php/pre/article/view/142/452
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| Rights |
Copyright (c) 2017 Philippine Review of Economics
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