The first paper to present the **Influential Expectations Hypothesis** – **IEH** has seen the light of day (in Greek and in English at the same time). It has been published in the “Greek Economic Outlook”, a peer-reviewed scientific journal (albeit of local character) published by the Centre Of Planning and Economic Research (KEPE) vol. 28, October 2015.

**The** **Influential Expectations Hypothesis is a generalization of the Rational Expectations Hypothesis** **in the presence of heterogeneity of agents, private information, and specialization in predicting macroeconomic variables** -all three actually observed phenomena. As a generalization, it includes REH as a special case.The hypothesis is *not* really behavioral -my aim is macroeconomics and to arrive at the aggregate level starting from micro-foundations that are consistent with current economic theory. I am not interested in hypothesizing about or modelling how the human mind works.

The specific paper presents how this expectations-formation hypothesis is constructed (the paper is months old -the theoretical foundations have since been refined and fortified considerably), a theoretical application on the Cobweb model (the one also used by John Muth for the first presentation of the Rational Expectations Hypothesis-REH), a comparison of theoretical results with those obtained under the REH (they differ markedly), as well as an indicative econometric application showing that the data support the **IEH** result.

The good thing about the **IEH** hypothesis is that in light of the level of complexity it allows into a model, it results in a very intuitive formulation which moreover permits closed form solutions. The even better thing about it, is that it brings in really new results: I have also applied the hypothesis to the benchmark Optimal Growth model, and what my eyes saw emerging was fascinating (as well as realistic and convincing). I will submit the more mature theoretical formulation together with the Optimal Growth model application to an international journal for review and we will see what happens.

**The Greek version of the paper:**

**2015 Papadopoulos A GREEK Influential Expectations Hypothesis Greek Economic Outlook 28**

**The English version of the paper:**

**2015 Papadopoulos A ENG Influential Expectations Hypothesis Greek Economic Outlook 28**