An examination of how the rational expectations revolution and game theory have enhanced the understanding of how an economy functions.

This book is focused on the recent developments on problems of probability model uncertainty by using the notion of nonlinear expectations and, in particular, sublinear expectations. It provides a gentle coverage of the theory of nonlinear expectations and related stochastic analysis. Many notions and results, for example, G-normal distribution, G-Brownian motion, G-Martingale representation theorem, and related stochastic calculus are first introduced or obtained by the author. This book is based on Shige Peng’s lecture notes for a series of lectures given at summer schools and universities worldwide. It starts with basic definitions of nonlinear expectations and their relation to coherent measures of risk, law of large numbers and central limit theorems under nonlinear expectations, and develops into stochastic integral and stochastic calculus under G-expectations. It ends with recent research topic on G-Martingale representation theorem and G-stochastic integral for locally integrable processes. With exercises to practice at the end of each chapter, this book can be used as a graduate textbook for students in probability theory and mathematical finance. Each chapter also concludes with a section Notes and Comments, which gives history and further references on the material covered in that chapter. Researchers and graduate students interested in probability theory and mathematical finance will find this book very useful.

The Symposium aimed at analysing and solving the various problems of representation and analysis of decision making in economic systems starting from the level of the individual firm and ending up with the complexities of international policy coordination. The papers are grouped into subject areas such as game theory, control methods, international policy coordination and the applications of artificial intelligence and experts systems as a framework in economic modelling and control. The Symposium therefore provides a wide range of important information for those involved or interested in the planning of company and national economics.

Contents:How Many "Demons" Do We Need? Endophysical Self-Creation of Material Structures and the Exophysical Mystery of Universal Libraries (G Kampis & O E Rössler)Some Implications of Re-Interpretation of the Turing Test for Cognitive Science and Artificial Intelligence (G Werner)Why Economic Forecasts will be Overtaken by the Facts (J D M Kruisinga)Simulation Methods in Peace and Conflict Research (F Breitenecker et al)Software Development Paradigms: A Unifying Concept (G Chroust)Hybrid Hierarchies: A Love-Hate Relationship Between ISA and SUPERC (D Castelfranchi & D D'Aloisi)AI for Social Citizenship: Towards an Anthropocentric Technology (K S Gill)Organizational Cybernetics and Large Scale Social Reforms in the Context of Ongoing Developments (E Bekjarov & A Athanassov)China's Economic Reform and its Obstacles: Challenges to a Large-Scale Social Experiment (J Hu & X Sun)Comparing Conceptual Systems: A Strategy for Changing Values as well as Institutions (S A Umpleby)and others Readership: Researchers in the fields of cybernetics and systems, artificial intelligence, economics and mathematicians.

This lucidly written study is unique in that there is no book extant by an economic historian that discusses Talmudic economics in the light of modern economics. Its major focus is on the intricate debates, statements and principles that were forged by the Talmudic Rabbis. This ancient storehouse of learning includes a wealth of economic knowledge of modern sophistication. The book taps these "economic treasures" by way of analytic inquiry. The authors, both economic historians and economists, through their study of the original dialectics in the Talmud, were able to discern a wide range of macro- and micro-economic ideas of major significance. These concepts when viewed from either a contemporary or a modern perspective, display an extraordinary degree of insight and sophistication. Indeed, sections of the Talmud and the reflections of subsequent commentators on those passages, embody a wealth of economic thought that was later to become significant in the reasoning of political economists, or of their professional academic successors.

Control theory methods in economics have historically developed over three phases. The first involved basically the feedback control rules in a deterministic framework which were applied in macrodynamic models for analyzing stabilization policies. The second phase raised the issues of various types of inconsistencies in deterministic optimal control models due to changing information and other aspects of stochasticity. Rational expectations models have been extensively used in this plan to resolve some of the inconsistency problems. The third phase has recently focused on the various aspects of adaptive control. where stochasticity and information adaptivity are introduced in diverse ways e.g .• risk adjustment and risk sensitivity of optimal control, recursive updating rules via Kalman filtering and weighted recursive least squares and variable structure control methods in nonlinear framework. Problems of efficient econometric estimation of optimal control models have now acquired significant importance. This monograph provides an integrated view of control theory methods, synthesizing the three phases from feedback control to stochastic control and from stochastic control to adaptive control. Aspects of econometric estimation are strongly emphasized here, since these are very important in empirical applications in economics.

How have monetary policies matured during the last decade? The recent downturn in economies worldwide have put monetary policies in a new spotlight. In addition to their investigations of new tools, models, and assumptions, they look carefully at recent evidence on subjects as varied as price-setting, inflation persistence, the private sector's formation of inflation expectations, and the monetary policy transmission mechanism. They also reexamine standard presumptions about the rationality of asset markets and other fundamentals. Stopping short of advocating conclusions about the ideal conduct of policy, the authors focus instead on analytical methods and the changing interactions among the ingredients and properties that inform monetary models. The influences between economic performance and monetary policy regimes can be both grand and muted, and this volume clarifies the present state of this continually evolving relationship. - Presents extensive coverage of monetary policy theories with an eye toward questions raised by the recent financial crisis - Explores the policies and practices used in formulating and transmitting monetary policies - Questions fiscal-monetary connnections and encourages new thinking about the business cycle itself - Observes changes in the formulation of monetary policies over the last 25 years

Macroeconomic Modelling has undergone radical changes in the last few years. There has been considerable innovation in developing robust solution techniques for the new breed of increasingly complex models. Similarly there has been a growing consensus on their long run and dynamic properties, as well as much development on existing themes such as modelling expectations and policy rules. This edited volume focuses on those areas which have undergone the most significant and imaginative developments and brings together the very best of modelling practice. We include specific sections on (I) Solving Large Macroeconomic Models, (II) Rational Expectations and Learning Approaches, (III) Macro Dynamics, and (IV) Long Run and Closures. All of the contributions offer new research whilst putting their developments firmly in context and as such will influence much future research in the area. It will be an invaluable text for those in policy institutions as well as academics and advanced students in the fields of economics, mathematics, business and government. Our contributors include those working in central banks, the IMF, European Commission and established academics.

Global econometric models have a long history. From the early 1970s to the present, as modeling techniques have advanced, different modeling paradigms have emerged and been used to support national and international policy making. One purpose of this volume — based on a conference in recognition of the seminal impact of Nobel Prize winner in Economic Sciences Lawrence R Klein, whose pioneering work has spawned the field of international econometric modeling — is to survey these developments from today's perspective.A second objective of the volume is to shed light on the wide range of attempts to broaden the scope of modeling on an international scale. Beyond new developments in traditional areas of the trade and financial flows, the volume reviews new approaches to the modeling of linkages between macroeconomic activity and individual economic units, new research on the analysis of trends in income distribution and economic wellbeing on a global scale, and innovative ideas about modeling the interactions between economic development and the environment.With the expansion of elaborated economic linkages, this volume makes an important contribution to the evolving literature of global econometric models.

7. 2 Cumulative Pollutants and the Rate of Economic Growth 217 7. 3 Economic Growth in an Unregulated Economy 223 7. 4 Economic Growth in a Degrading Economy 231 7. 5 Economic Growth in the Spaceship Economy 237 7. 6 Dynamic Equilibrium in the Spaceship Economy 248 7. 7 An Evaluation of the Model and some Conclusions 254 7. 8 Some Long-Term Implications of the Model 256 References 258 Chapter 8: Optimal Economic Growth when CO Constraints are Critical 2 8. 1 Introduction 259 8. 2 Formulation of the Problem 260 8. 3 Derivation of the Necessary Conditions 264 8. 4 Analysis of the Necessary Conditions 265 8. 5 Conclusion 277 References 279 Chapter 9: Uncertainty. Value of Information and Greenhouse Gas Emissions 9. 1 Introduction 280 9. 2 An Illustrative Example - Evaluating a Climate Research and Monitoring Programme 282 293 9. 3 The Value of Information in a Stochastic Dynamic Programme 301 9. 4 Optimal Policies in a Stochastic Dynamic Programme 307 9. 5 Resource Costs and Critical Probabilities 9. 6 Conclusions 314 317 References 319 Epilogue 325 Index viii Preface The movement of carbon from sources to final disposition is known as the carbon cycle. The largest reservoir of carbon is in carbonate sediments such as limestone and chalk. Other significant but less stable reservoirs include fossil fuels, living and dead plants and animals, carbonates and bicarbonates dissolved in the ocean.