THE ESTABLISHMENT OF ROBERT E. LUCAS JR.'S MACROECONOMICS OF EQUILIBRIUM AND HIS DIFFERENT USES OF THE RATIONAL EXPECTATIONS HYPOTHESIS

Abstract

The aim of my post-doctoral research is to make a historical analysis of the evolution of macroeconomics in the 1970's through the work of Robert E. Lucas Jr.. The macroeconomics of equilibrium approach proposed by Lucas (1972), characterized by a general equilibrium with rational expectations model, launched a new research agenda in the field, which gained adherents and critics, especially regarding the use of rational expectations hypothesis. The launch of this new research agenda implied an attack on the effective Keynesian paradigm, and had theoretical and economic policy consequences that last until today. In my research, I intend to reconstruct the trajectory of Lucas's work in the 1970's by analyzing his theoretical work, his personal and professional relationships, his different uses and justifications to the rational expectations hypothesis and the implication of his equilibrium approach to economic policy. In this way, I will continue my own research agenda on the history of macroeconomics in the post-war period. A similar exercise on the different uses of rational expectations hypothesis was made by Sent (1998) - to the work of Thomas Sargent -, which paved the way to new historical analyses on the uses of rational expectations hypothesis in the work of other economists. My research intends to follow this way paved by Sent (1998) by interpreting the different uses of the rational expectations hypothesis in the work of Robert Lucas in the 1970's, in the context of the establishment of his macroeconomics of equilibrium research program.