Rational expectations and economic theory, Microeconomics

Assignment Help:

RATIONAL EXPECTATIONS AND ECONOMIC THEORY :

Much of undergraduate macroeconomic theory is discussed on the assumption that, in the short run, the expectations of economic agents about the future values of macroeconomic variables are given. The rationale for this treatment of expectations in macroeconomic theory can be derived from Keynes' views on the nature of expectations, including his discussion in the General Theory. While Keynes’ views on the nature of uncertainty and expectations form the basis for the writings, of many Post-Keynesian economists, most of modern macroeconomic theory treats uncertainty and expectations in a radically different manner. This latter approach is characterised in economic theory by the assumption that economic agents (households, business firms and government) have rational expectations abc, macroeconomic variables. 


Related Discussions:- Rational expectations and economic theory

Economic reforms and reduction of regional disparities, Economic Reforms an...

Economic Reforms and Reduction of Regional Disparities: Another important objective of development is to reduce regional disparities. Government has been helping the backward

Demand and supply, discuss and illustrates the following terms with diagra...

discuss and illustrates the following terms with diagrams1.inferior goods.2.normal goods,3.giffen goods

Neer vs reer, NEER Vs REER: In a situation where there are multiple tr...

NEER Vs REER: In a situation where there are multiple trade partners, the effect of cross-currency movements are judged by nominal effective exchange rate (NEER) and real effe

Public good , Graphically illustrate how society decides on the number of p...

Graphically illustrate how society decides on the number of police officers to hire

Need answer as a assignment right now please, Consider what would happen if...

Consider what would happen if a taxes of 10000$ was imposed on imported automobiles on dealers.Using a demand and supply diagram, show its impact of price and quantity. Suppose the

What do you meant by informal economy, Q. What do you meant by Informal Eco...

Q. What do you meant by Informal Economy? Informal Economy:Informal sector of the economy represents the production of services and goods for the own-use of the producers or fo

Answer paper, What is the theory of Second Best? Prove the theorem with the...

What is the theory of Second Best? Prove the theorem with the help of a diagram.

Price adjustments under fixed exchange rate, PRICE ADJUSTMENTS UNDER FIXED ...

PRICE ADJUSTMENTS UNDER FIXED EXCHANGE RATE: In a flexible exchange rate regime trade deficits (surpluses) are automatically corrected by a depreciation (appreciation) of a co

Opportunity cost, what are the concept of opportunity cost

what are the concept of opportunity cost

Subject matter of economics, Ask factor affects elasticity of demandquestio...

Ask factor affects elasticity of demandquestion #Minimum 100 words accepted#

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd