Convergence of learning algorithms without a projection facility (Q1300379)

This paper addresses convergence of learning algorithms without the use of a projection facility. In earlier research direct proofs of convergence in simple models was employed, but new research has showed that those same results an be obtained using the stochastic approximation technique of \textit{L. Ljung} [IEEE Trans. Autom. Control 22, 551-575 (1977; Zbl 0362.93031)]. This method is used to analyze local stability in stochastic dynamic economic models in the presence of multiple equilibria. The analysis is conducted under the assumption of Markovian state variable dynamics. Finally, we present two economic applications of the convergence result.