On Thu, Dec 18, 2008 at 4:19 PM, Julio Huato <[email protected]> wrote: > Jim, > > With all due respect, *think* about it. > > How can *anybody* lead a life without the ergodic assumption, > including Keynes and his followers? > > *Therefore*, how can any macroeconomic theory dispense with the > ergodic assumption altogether? > > What would you put in the place of the ergodic assumption instead? > > What else is there to form one's expectations but experience, history > -- interpreted one way or another?
I think the point is that a much weaker ergodicity assumption is actually required than commonly assumed. For e.g., it may be necessary to assume that herding and mob psychology will be pretty much the same in future as in the past. But it is not necessary to assume that stock price distributions are stationary (let alone ergodic). -raghu. -- "I used to do drugs. I still do drugs. But I used to, too." - Mitch Hedberg _______________________________________________ pen-l mailing list [email protected] https://lists.csuchico.edu/mailman/listinfo/pen-l
