margin – предел, маржа
marginal – предельный, маргинальный
maximize – увеличивать
neoclassical – неоклассический
optimize – оптимизировать
outlook – взгляд, мировоззрение
property – свойство, качество
reconcile – примирять
relevant – соответствующий, соотносимый
scarcity – недостаток
signal – сигнал
substitute – заменять, подменять
tend – стремиться, следовать тенденции, устанавливать тенденцию
utility – полезность, практичность, выгодность
value theory – теория стоимости
two-fold – двусторонний
came to be called – стал называться
Marginal Revolution – Маржиналистская Революция (маржинализм – теория предельной полезности и производительности)
extra unit – дополнительная единица (продукции)
give up – оставлять, бросать
take into consideration – принимать во внимание
economic agents – участники экономической жизни, экономических процессов
in this context – в данном контексте
bid up – набавлять цену
oust out – вытеснять
buy order – заказ на продажу
sell order – заказ на покупку
Exercise 9
Answer the questions:
1. What view did the economists in the XIXth century accept?
2. What did the value of a product depend on, in accord with the classical value theory?
3. How were products distributed, according to this theory?
4. Whose ideas did the classical theory have roots in?
5. Why didn't the classical theory work in practice?
6. What theories were the classical theories substituted by?
7. What is value, in the neoclassical view?
8. Where do buyers and sellers make their choices, according to the neoclassical view?
9. What is «utility», in the neoclassical sense of the word?
10. Who do neoclassical theories take into consideration?
Rational Expectations Theory
The theory of rational expectations is based on the assumption that in many economic situations the outcome depends partly upon what people expect to happen. The value of a currency, for example, depends to a great extent on what people expect that currency's rate of depreciation to be. That is because people hurry to give up a currency that they expect to lose value, thereby contributing to its depreciation. In the same way, the price of shares depends partly on what the shares' buyers and sellers believe it to be in the future.
The relation between expectations and outcomes is two-fold. In forming their expectations, people try to forecast what will actually occur, and the results of their forecasting, provided that they were correct, help them form expectations for the future outcomes. There is continual feedback from past outcomes to current expectations, as in recurrent situations the way the future unfolds from the past tends to be stable, and people adjust their forecasts to conform to this stable pattern.