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The expectations hypothesis of the term structure of interest rates (whose graphical representation is known as the yield curve) is the proposition that the long-term rate is determined purely by current and future expected short-term rates, in such a way that the expected final value of wealth from investing in a sequence of short-term bonds equals the final value of wealth from investing in ...
The preferred habitat theory is a variant of the liquidity premium theory, and states that in addition to interest rate expectations, investors have distinct investment horizons and require a meaningful premium to buy bonds with maturities outside their "preferred" maturity, or habitat.
Expectancy violations theory (EVT) is a theory of communication that analyzes how individuals respond to unanticipated violations of social norms and expectations. [1] The theory was proposed by Judee K. Burgoon in the late 1970s and continued through the 1980s and 1990s as "nonverbal expectancy violations theory", based on Burgoon's research studying proxemics.
A detailed example of the positivist approach is a study conducted by the Public Policy Institute of California report titled "Evaluating Academic Programs in California's Community Colleges", in which the evaluators examine measurable activities (i.e. enrollment data) and conduct quantitive assessments like factor analysis.
This analysis would, however, be subject to the Lucas Critique, and the conclusion would be misleading. In order to properly analyze the trade-off between the probability of a robbery and resources spent on guards, the "deep parameters" (preferences, technology and resource constraints) that govern individual behaviour must be taken explicitly ...
Critics of the theory argue that performance expectations could be "epiphenomenal", and do not serve as a mediator. The meta-analysis finds support for the theory (i.e., status predicts expectations, and expectations predict behavior, but status has little effect on behavior beyond that which can be attributed to expectations).
The concept of rational expectations was first introduced by John F. Muth in his paper "Rational Expectations and the Theory of Price Movements" published in 1961. Robert Lucas and Thomas Sargent further developed the theory in the 1970s and 1980s which became seminal works on the topic and were widely used in microeconomics. [1] Significant ...
Cobweb theorem and the rational (consistent) expectations hypothesis are part of welfare economics which according to Martin and Schumann's argument act now to worsen the welfare of the majority of mankind. Nicholas Kaldor's work The Scourge of Monetarism is an analysis of how the policies described by Martin and Schumann came to the United ...