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W. Branch, E. Gasteiger:
"Endogenously (Non-)Ricardian Beliefs";
Bericht für Vienna University of Technology Working Papers in Economic Theory and Policy; 2019.

This paper develops a theory of endogenously (non-)Ricardian beliefs. That is,whether Ricardian Equivalence holds in an equilibrium depends on endogenous privatesector beliefs. The novelty here is a restricted perceptions viewpoint: in complex fore-casting environments, agents forecast aggregate variables with (potentially) misspeci-fied models that are optimal within the restricted class, i.e., a restricted perceptionsequilibrium (RPE). A misspecification equilibrium is a refinement of an RPE where thechoice of restricted models is endogenous. Our formalization considers two predictors:in one rule Ricardian beliefs emerge as a self-confirming equilibrium, while the otherfeatures an equilibrium with non-Ricardian beliefs. We show that (1.) there can existmisspecification equilibria where beliefs are endogenously (non-)Ricardian, (2.) multi-ple equilibria exist where the economy can coordinate on Ricardian or non-Ricardianequilibria. The theory suggests a novel interpretation of post-war U.S. inflation dataas being generated by endogenous belief-driven regime change and a nuanced trade-offfor monetary policy rules.

https://www.econ.tuwien.ac.at/wps/econ_wp_2019_03.pdf