Review of Economic Studies Vol. 49 No. 3 1982
Stability of the Neumann Ray in a Dynamic Leontief System with Finite Forecast Horizons
Abstract
This paper considers whether the dynamic stability of the steady-state growth path, deduced in various models under the assumption of perfect foresight, can be sustained if foresight is imperfect. Using a dynamic Leontief system as the framework and measuring the degrees of goodness of foresight by the length of the forecast horizon, the paper derives an affirmative answer. The result can also be interpreted as asserting that the Neumann ray serves as a turnpike for a rolling plan of a long planning horizon.
- DOI
- 10.2307/2297369
- Volume
- 49
- Issue
- 3
- Pages
- 461
- Sources
- openalex crossref