When multiple equilibria are possible, they must be accounted for in any empirical analysis.
This includes discussions of the determinants of the computational burden of these techniques, and the mechanism implicitly used to select an equilibrium when multiple equilibria are possible.
Insights from the study of complex systems, particularly the chaos theory, point to one of the most fundamental limitations of sustainability, namely, the ubiquity of change, whether gradual or rapid, and the notion that states of equilibrium are the exception and that, even when they exist, they are only temporary with regular transitions between multiple equilibria.
That paper considers the implications of multiple equilibria; however, its only dynamic aspect is young officials taking into account the expected payoff of bribes they might receive when they are old.
Positive feedback and multiple equilibria have to be taken seriously.
And the recursive nature of this process means that multiple equilibria are possible.
Any economy was capable of what modern economists call "multiple equilibria": different stable points of functioning, at levels ranging from penury to prosperity.
Finally, the whole euro situation is fraught with multiple equilibria and the risk of self-fulfilling panics — which means that there can sometimes be disproportionate responses in a way that doesn't make sense when we're talking about budget cuts.
More recently, a theory of "multiple equilibria" has gained support, in which there is more than one probable outcome, with market expectations usually the deciding factor.
Faced with such multiple equilibria, it is a central bank's responsibility to ensure that the "good" (i.e. low yield) equilibrium is reached.
