Explain what happens under adaptive expectations theory...?

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...when monetary and fiscal policy makers use expansionary policy to achieve an unemployment rate below the natural rate.

2007-03-27 10:17:21 · 1 answers · asked by lane_saugt_hahn_fur_drogen 1 in Social Science ➔ Economics

The expectation changes that fewer people will always be unemployed, even though right now in this instance they are lower than the natural.

2007-03-27 11:05:36 · answer #1 · answered by Santa Barbara 7 · 0⤊ 0⤋