Sometimes navigating the financial markets is like attempting to solve a jigsaw, except the image on the box is always ...

Even when rational processes are used, many good decisions will, with hindsight, have inferior outcomes; or many good forecasts will prove partly or fully incorrect. It's mostly bad luck, but also ...

But why does this happen, and how do rational expectations lead us into a bubble-filled frenzy? This article unpacks the nuances of overvaluation by focusing on three key components – the herd ...

A medium-scale DSGE model with adaptive learning, estimated during 1965-2022, has a time-varying solution that produces lower forecast errors for inflation than a variant with rational expectations.