Rational Expectations (Cambridge Surveys of Economic Literature) - Hardcover

Sheffrin, Steven M.

Hardcover

ISBN 10: 0521474000 ISBN 13: 9780521474009

Publisher: Cambridge University Press, 1996

Synopsis

Economists have developed models in which individuals form expectations of key variables in a 'rational' manner such that these expectations are consistent with actual economic environments. Professor Sheffrin first explores the logical foundation of the concept and the case for employing it in economic analysis. Subsequent chapters investigate its use in macroeconomics, financial markets, and microeconomics. A final chapter assesses its impact on theoretical and empirical work in economics and policy arenas. The author argues that while rational expectations are still central to macroeconomic policy debates, fully workable models have not yet been devised, and offers reasons for the lack of practical and conceptual progress. All chapters of the second edition have been revised or expanded. New sections inter alia include material on learning, the rationality of reported expectations, alternative recent developments explicitly or implicitly using rational expectations, new tests of the Lucas critique, and models of noise trading. The book is written in a non-technical fashion for beginning graduate students and non-specialists.

About this title

Book Description

In recent years, economists have developed models in which individuals form expectations of key variables in a 'rational' manner such that these expectations are consistent with actual economic environments. This book develops the idea of rational expectations and surveys its use in economics today.

From the Back Cover

Professor Sheffrin first explores the logical foundation of the concept and the case for employing it in economic analysis. A final chapter assesses its impact on theoretical and empirical work in economics and policy arenas.

Edition details

• Publisher: Cambridge University Press
• Publication date: 1996
• Language: English
• ISBN 10: 0521474000
• ISBN 13: 9780521474009
• Binding: Hardcover
• Edition number: 2
• Number of pages: 200