New research reveals how limited information can lead to unpredictable economic outcomes.
The article explores how different levels of information among agents can lead to multiple possible outcomes in economic models. When some agents have limited information and need to figure out missing data, it can create unstable situations where expectations become reality. This can happen even when there would be only one clear outcome with full information. The researchers show this using a scenario involving a central bank making decisions based on incomplete information about interest rates.