In the 1980s, Waldman conducted research on the ramifications of heterogeneous information-processing abilities for equilibrium behavior, including for macroeconomic models characterized by strategic complements. Waldman found that, given strategic substitutes, the rational or sophisticated agents have a disproportionate impact on equilibrium behavior. But, given strategic complements, it is the limitedly rational or naïve agents who are disproportionately important. Further, he shows that this result can serve as a contributing factor to the persistence of macroeconomic shocks if the macroeconomy is characterized by strategic complements.
