Abstract

Abstract. This paper explores the close affinity between the theory of rational expectations that revolutionized economics in the 1960s and 1970s and the phenomenology of consciousness and human existence in philosophy that preceded it. In so doing, we trace the evolution of the views in economics on the decision making modes and the role of the market system, from Keynes, to Friedman, to Muth, and then to Lucas, and place the theory of rational expectations in perspective in relation to the phenomenology of the inner time consciousness a la Husserl and of human existence a la Heidegger as well as to Aristotle's ethics of human life as a life of actions. It is argued that the theory of rational expectations, along with its insight and implications, has brought economics to its home ground, that is, the ethical nature of human existence. Keywords. Intertemporal optimization, Rational expectations, Phenomenology, Internal time consciousness, Human existence, Anticipation, Environment, Neutrality of money, Econometric policy evaluation, Ethical nature. JEL. A12, B10,B11, B20,B21, B22, D01, E00, E41.

Talk to us

Join us for a 30 min session where you can share your feedback and ask us any queries you have

Schedule a call

Disclaimer: All third-party content on this website/platform is and will remain the property of their respective owners and is provided on "as is" basis without any warranties, express or implied. Use of third-party content does not indicate any affiliation, sponsorship with or endorsement by them. Any references to third-party content is to identify the corresponding services and shall be considered fair use under The CopyrightLaw.