naive expectation

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This criterion was used in the old days to criticize the practice of attributing to agents adaptive and other naive expectations schemes.
Consider first an initial state where prices are close to the steady-state value and almost all agents use naive expectations.
Because almost all of the agents are using naive expectations, the model has a cobweb-like instability.
Examples of possible expectations strategies include naive expectations and rational expectations.
Naive expectations thus would predict future market precision just as accurately as rational expectations.
As prices diverge from the steady-state value, the prediction error from the naive expectations will increase.
Would boundedly rational agents be able to discover regularities in their forecasting errors under naive expectations and change expectations accordingly?
Because the author is so candid in describing her feelings and experiences, one is moved by her stories but one can also criticise her more naive expectations of the field.
Suppose that in the current time period (period 1), most agents have naive expectations as well as small amounts of private information.
Ezekiel (1938) investigated the price dynamics in the cobweb model under naive expectations, where the expected price for tomorrow equals today's price.
In fact, under naive expectations and with the other parameters fixed as before, complicated dynamics arise for relatively small values of the discount rate, for example, for 0.02 0.085.
It is not hard to show by graphical analysis that, for example, for the tangent bifurcation value 0.085, the dynamics under naive expectations are (topologically) chaotic.
We are being asked to pay a constitutional price for naive expectations.
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