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In this paper we construct sunspot equilibria that arise from chaotic deterministic dynamics. These equilibria are stationary and have absolutely continuous stationary measures. We prove that they can be learned by a simple rule based on the histograms of past state variables. This work gives a theoretical justification for complex deterministic models that might compete with stochastic models to explain real data. Also we prove the stochastic stability of the indeterminate equilibrium.
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Received: June 2, 1997; revised version: December 5, 1998
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Araujo, A., Maldonado, W. Ergodic chaos, learning and sunspot equilibrium. Econ Theory 15, 163–184 (2000). https://doi.org/10.1007/s001990050005
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DOI: https://doi.org/10.1007/s001990050005