IDEAS home Printed from
MyIDEAS: Log in (now much improved!) to save this article

The disappointment of expectations and the theory of fluctuations

Listed author(s):
  • Ferdinando Meacci


    (Università degli Studi di Padova - Dipartimento di Scienze Economiche e Aziendali «M. Fanno»)

The role of expectations in macroeconomic theory was launched in the 1930s and has been re-launched in the second half of the 20th century. The focus of the first phase was on the impact on macroeconomic fluctuations of «errors in time» (Fanno 1933) or, which comes to the same, of the «disappointment of expectations» (Hicks 1933). This was in line with the replacement of the paradigm of General Equilibrium Theory – which took place in those years and whose framework is logical time – by the new paradigm of Uncertainty and Expectations – whose framework is historical time and whose initial centre of gravitation was the fluctuations of effective demand (Keynes 1936). The scope of this paper is to evaluate the role assigned to errors in time or disappointment of expectations in the theory of macroeconomic fluctuations. The paper is divided in two parts. The first is concerned with the achievements of the ‘years of high theory’, the second with the achievements of the ‘years of rational expectations’. The first part provides a benchmark for evaluating the achievements discussed in the second part. The paper shows that the focus on errors in time has been replaced in recent times by a set of assumptions and arguments which either neglect the impact on fluctuations of the disappointment of expectations or even exclude the very possibility of this disappointment. The paper concludes by comparing the achievements of macroeconomic theory in the two phases of its development and by ranking their different relevance for the modern theory of fluctuations.

If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.

File URL:
Download Restriction: Access to full text is restricted to subscribers

As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.

Article provided by Fabrizio Serra Editore, Pisa - Roma in its journal History of Economic Ideas.

Volume (Year): 20 (2012)
Issue (Month): 2 ()
Pages: 157-184

in new window

Handle: RePEc:hid:journl:v:20:y:2012:2:7:p:157-184
Contact details of provider: Web page:

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:

in new window

  1. Sargent, Thomas J. & Wallace, Neil, 1976. "Rational expectations and the theory of economic policy," Journal of Monetary Economics, Elsevier, vol. 2(2), pages 169-183, April.
  2. Tony Lawson, 2009. "The current economic crisis: its nature and the course of academic economics," Cambridge Journal of Economics, Oxford University Press, vol. 33(4), pages 759-777, July.
  3. Roger E. A. Farmer, 1999. "Macroeconomics of Self-fulfilling Prophecies, 2nd Edition," MIT Press Books, The MIT Press, edition 2, volume 1, number 0262062038, January.
  4. Meacci, Ferdinando & Caldari, Katia, 2007. "Errors in Time as Causes of Economic Fluctuations: An Introduction," MPRA Paper 11703, University Library of Munich, Germany.
  5. Kregel, J A, 1976. "Economic Methodology in the Face of Uncertainty: The Modelling Methods of Keynes and the Post-Keynesians," Economic Journal, Royal Economic Society, vol. 86(342), pages 209-225, June.
  6. Ferdinando Meacci, 2009. "Uncertainty And Expectations In Shackle'S Theory Of Capital And Interest," Metroeconomica, Wiley Blackwell, vol. 60(2), pages 302-323, May.
Full references (including those not matched with items on IDEAS)

This item is not listed on Wikipedia, on a reading list or among the top items on IDEAS.

When requesting a correction, please mention this item's handle: RePEc:hid:journl:v:20:y:2012:2:7:p:157-184. See general information about how to correct material in RePEc.

For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Mario Aldo Cedrini)

If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

If references are entirely missing, you can add them using this form.

If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.

If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.

Please note that corrections may take a couple of weeks to filter through the various RePEc services.

This information is provided to you by IDEAS at the Research Division of the Federal Reserve Bank of St. Louis using RePEc data.