Estimation and Identification of Structural Parameters in the Presence of Multiple Equilibria

Russell W. Cooper

NBER Working Paper No. 8941
Issued in May 2002
NBER Program(s):   EFG

This paper studies quantitative implications of model economies that exhibit multiple equilibria. The goal is to assess two interrelated issues. First, do economies with multiple equilibria have falsifiable predictions? Second, is identification possible in economies that exhibit multiple equilibria? Put differently, are these economies observationally equivalent to economies with unique equilibria? We raise these questions within a general framework and then study a series of examples to determine how the existing literature has addressed them.

(269 K)

Published: Cooper, Russell W. "Estimation And Identification Of Structural Parameters In The Presence Of Multiple Equilibria," Eastern Economic Journal, v31(1,Winter), 2005, 107-130.

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