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This book is set against the assumption that humans' unique feature
is their infinite creativity, their ability to reflect on their
deeds and to control their actions. These skills give rise to
genuine uncertainty in society and hence in the economy. Here, the
author sets out that uncertainty must take centre stage in all
analyses of human decision making and therefore in economics.
Uncertainty and Economics carefully defines a taxonomy of
uncertainty and argues that it is only uncertainty in its most
radical form which matters to economics. It shows that uncertainty
is a powerful concept that not only helps to resolve long-standing
economic puzzles but also unveils serious contradictions within
current, popular economic approaches. It argues that neoclassical,
real business cycle, or new-Keynesian economics must be understood
as only one way to circumvent the analytical challenges posed by
uncertainty. Instead, embracing uncertainty offers a new analytical
paradigm which, in this book, is applied to standard economic
topics such as institutions, money, the Lucas critique, fiscal
policy and asset pricing. Through applying a concise uncertainty
paradigm, the book sheds new light on human decision making at
large. Offering policy conclusions and recommendations for further
theoretical and applied research, it will be of great interest to
postgraduate students, academics and policy makers.
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