rational expectations

plural noun

: an economic theory holding that investors use all available information about the economy and economic policy in making financial decisions and that they will always act in their best interest

rational expectationist

-ˌekˌspekˈtāshənėst

noun

Word History

First Known Use

1960, in the meaning defined above

Time Traveler

The first known use of rational expectations was in 1960

See more words from the same year

Cite this Entry

Style

“Rational expectations.” Merriam-Webster.com Dictionary, Merriam-Webster, https://www.merriam-webster.com/dictionary/rational%20expectations. Accessed 29 Nov. 2024.

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