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Theoria, Beograd 2009
Animal spirits: Keynes' theory of rational investment decision-making under conditions of fundamental uncertaintyDOI: 10.2298/theo0901017r Keywords: risk , uncertainty , investments , conventional decision-making , animal spirits Abstract: Keynes's term, animal spirits, has been mistakenly confused with irrational decision-making. However, if we accept Keynes' assumption that future is fundamentally uncertain and nonergodic, animal spirits become key factor that makes continual process of investment decision-making possible. On the other hand, if animal spirits blunt, investment activity dwindles and makes emergence of deep economic crisis likely.
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