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American Economic Review: Vol. 102 No. 3 (May 2012)

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International Robust Disagreement

Article Citation

Colacito, Riccardo, and Mariano M. Croce. 2012. "International Robust Disagreement." American Economic Review, 102(3): 152-55.

DOI: 10.1257/aer.102.3.152

Abstract

We characterize the equilibrium of a two-country, two-good economy in which agents have opposite preference bias toward one of the two consumption goods and fear model misspecification. We document that disagreement about endowments' growth prospects is a persistent endogenous outcome of this class of economies.

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Authors

Colacito, Riccardo (U NC)
Croce, Mariano M. (U NC)

JEL Classifications

D11: Consumer Economics: Theory
D81: Criteria for Decision-Making under Risk and Uncertainty
D83: Search; Learning; Information and Knowledge; Communication; Belief


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