Ciência-IUL
Publications
Publication Detailed Description
Journal Title
Revista Brasileira de Economia
Year (definitive publication)
2006
Language
English
Country
Brazil
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Abstract
Research activities have uncertain outcomes. The question asked in this paper is whether or not this uncertainty can be a central piece on the explanation of long run consumption growth paths. More specifically, we inquire how the existence of different research projects, with different degrees of uncertainty, contributes to unpredictable consumption growth paths. The proposed scenario is a two-sector representative consumer model with researchers that invest in different innovation projects. There is heterogeneity in terms of risk associated to research programs (researchers invest in projects with the same expected outcome but different volatility). This difference in volatility, combined with an adaptive learning - bounded rationality rule, implies an aggregate index of technology and a consumption growth rate that do not present a predictable pattern over time.
Acknowledgements
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Keywords
Bounded rationality,Heterogeneous agents,Optimal control,Research activities,Volatility and chaos
Fields of Science and Technology Classification
- Economics and Business - Social Sciences
Funding Records
Funding Reference | Funding Entity |
---|---|
POCTI/ECO/48628/2002 | Fundação para a Ciência e a Tecnologia |