New Classical Macroeconomics

New classical macroeconomics, sometimes simply called new classical economics, is a school of thought in macroeconomics that builds its analysis entirely on a neoclassical framework. Specifically, it emphasizes the importance of rigorous foundations based on microeconomics, especially rational expectations.

New classical macroeconomics strives to provide neoclassical microeconomic foundations for macroeconomic analysis. This is in contrast with its rival new Keynesian school that uses microfoundations such as price stickiness and imperfect competition to generate macroeconomic models similar to earlier, Keynesian ones.

Read more about New Classical MacroeconomicsHistory, Foundation and Assumptions

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General Equilibrium Theory - Other Schools - New Classical Macroeconomics
... See also New classical macroeconomics and Real Business Cycle Theory While general equilibrium theory and neoclassical economics generally were originally microeconomic theories, New classical macroeconomics ... In new classical models, the macroeconomy is assumed to be at its unique equilibrium, with full employment and potential output, and that this equilibrium is assumed to always have been ...
New Classical Macroeconomics - Foundation and Assumptions
... New classical economics is based on Walrasian assumptions ... New classical economics has also pioneered the use of representative agent models ... neoclassical criticism, pointing to the clear disjuncture between microeconomic behavior and macroeconomic results, as indicated by Kirman (1992), and ...

Famous quotes containing the word classical:

    Classical art, in a word, stands for form; romantic art for content. The romantic artist expects people to ask, What has he got to say? The classical artist expects them to ask, How does he say it?
    —R.G. (Robin George)