From: Ted Winslow
The rationality postulate underpinning the view of financial markets that does actually dominate conventional economic analysis - the assumption of omniscient fully rational expectations - is very widespread.
Much Marxist analysis, for instance, seems to take it as the self-evidently true starting point for the analysis of capitalist behaviour. Capitalists are assumed to control policy and and to base their exercise of this control on omniscient fully rational expectations of the consequences of policy. Everything from the deregulation of financial markets to the invasion of Iraq to "accumulation by dispossession" is interpreted in this way.
^^^^^ CB: What about Marxist emphasis on the anarchy of capitalist production and the resultant periodic crises of overproduction which the capitalists' competitive, decentralized, unplanned, uncoordinated and non-omniscient activity causes ? Marxists famously reject idea of the Invisible Hand attached to the Omniscient Head and want to replace capitalist lack of planning with socialist planning.