Journal Article

Rational expectations business cycle models: a survey

Abstract: Development of rational expectations models of the business cycle has been the central issue in macroeconomics over the last 15 years. The postulate that expectations are rational imposes considerable discipline on business cycle analysis. In this essay we review the current literature on rational expectations models of business cycles with specific attention focused on the extent to which the rational expectations perspective has generated a new understanding of economic fluctuations.

Keywords: Macroeconomics; Business cycles; Rational expectations (Economic theory);

Bibliographic Information

Provider: Federal Reserve Bank of Richmond

Part of Series: Economic Review

Publication Date: 1988

Volume: 74

Issue: Mar

Pages: 3-15