IDEAS home Printed from https://ideas.repec.org/h/pal/palchp/978-1-137-00072-9_3.html
   My bibliography  Save this book chapter

Animal Spirits and Rationality

In: Foundations for New Economic Thinking

Author

Listed:
  • Sheila C. Dow

    (University of Stirling)

  • Alexander Dow

Abstract

The notion that ‘animal spirits’ govern investment decisions can be viewed as being central to Keynes’s theory of aggregate demand and, at the same time, as being its weakest point. An autonomous shift in long-run expectations among entrepreneurs can drive a wedge between effective demand and full employment output, requiring government stabilisation policy if full employment is to be achieved. That shifts in long-run expectations may occur autonomously is, however, regarded by many as cause for concern. If Keynes’s theory can neither explain nor predict these shifts, then it appears to be lacking a crucial element.

Suggested Citation

  • Sheila C. Dow & Alexander Dow, 2012. "Animal Spirits and Rationality," Palgrave Macmillan Books, in: Foundations for New Economic Thinking, chapter 3, pages 33-51, Palgrave Macmillan.
    • Handle: RePEc:pal:palchp:978-1-137-00072-9_3
    DOI: 10.1057/9781137000729_3
    as

    Download full text from publisher

    To our knowledge, this item is not available for download. To find whether it is available, there are three options:
    1. Check below whether another version of this item is available online.
    2. Check on the provider's web page whether it is in fact available.
    3. Perform a search for a similarly titled item that would be available.

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Mazzucato, Mariana & Semieniuk, Gregor, 2018. "Financing renewable energy: Who is financing what and why it matters," Technological Forecasting and Social Change, Elsevier, vol. 127(C), pages 8-22.
    2. Ronald Schettkat, 2018. "The Behavioral Economics of John Maynard Keynes," Schumpeter Discussion Papers sdp18007, Universitätsbibliothek Wuppertal, University Library.
    3. Ronald Schettkat, 2018. "Animal Spirits - Die Verhaltensökonomischen Grundlagen der Keynesschen Theorie," Schumpeter Discussion Papers sdp18008, Universitätsbibliothek Wuppertal, University Library.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:pal:palchp:978-1-137-00072-9_3. See general information about how to correct material in RePEc.

    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.

    We have no bibliographic references for this item. You can help adding them by using 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 RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.palgrave.com .

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

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.