<p>I think this is a poor oversimplication of Robert Lucas's maxim. It's one thing that Robert Lucas models markets as if "always in equilibrium", it's quite another Robert Lucas claims it's an empirical truth that  "market is always in equilibrium".</p>

<p><a href="http://people.hss.caltech.edu/~pbs/expfinance/Readings/Lucas1978.pdf" rel="nofollow">Lucas(1978)</a> explained briefly why he chose such methodology which doesn't faithfully reflects reality:</p>

<blockquote>
  <p>As always, there are innumerable ways for the economy to be out of equilibrium, so we must expect any treatment of out-of-equilibrium behavior to have considerable arbitrariness, not resolvable by economic reasoning.</p>
</blockquote>

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2015-07-05T09:30:05.620Z
2015-07-05T15:40:32.167Z
2015-07-05T15:40:32.167Z
Metta World Peace
<p>Does have anyone link to the reference where Robert Lucas said "market is always in equilibrium"?</p>

<macroeconomics><reference-request>
Where did Robert Lucas say "market is always in equilibrium"?
mark
# Where did Robert Lucas say "market is always in equilibrium"?

(Asked by: username_0 on 2015-01-01)

Does have anyone link to the reference where Robert Lucas said "market is always in equilibrium"?

**Tags:** macroeconomics, reference-request


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## 1 answers

### Answer by username_1 on 2015-07-05. Score: 4

I think this is a poor oversimplication of Robert Lucas's maxim. It's one thing that Robert Lucas models markets as if "always in equilibrium", it's quite another Robert Lucas claims it's an empirical truth that "market is always in equilibrium".

[Lucas(1978)](http://people.hss.caltech.edu/~pbs/expfinance/Readings/Lucas1978.pdf) explained briefly why he chose such methodology which doesn't faithfully reflects reality:

> As always, there are innumerable ways for the economy to be out of equilibrium, so we must expect any treatment of out-of-equilibrium behavior to have considerable arbitrariness, not resolvable by economic reasoning.


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