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

Love words?

You must — there are over 200,000 words in our free online dictionary, but you are looking for one that’s only in the Merriam-Webster Unabridged Dictionary.

Start your free trial today and get unlimited access to America's largest dictionary, with:

• More than 250,000 words that aren't in our free dictionary
• Expanded definitions, etymologies, and usage notes
• Advanced search features
• Ad free!