----------------- HES POSTING ----------------- First, isn’t this question of full (or perfect) information to do with formalization? To get hard-edged results (even to make problems tractable at all) takes simplifying assumptions - full information, divisibility, continuity of preferences, etc. Classical profit rate equalization requires full information about potential profitability in different sectors. We all know these are approximations. On a less formal level it can be fudged (as Marshall did) but formalization brings out the implicit assumptions. Second, full information about what? Depends what is being modelled. Basic perfect competition (demand and supply) requires full information about prices offered, but not much else. Simple intertemporal choice models require the individual to act as if she had full knowledge of the future, etc. Third, the full information assumption has been systematically relaxed in modern mainstream economics - asymmetric information is a major theme now, because we have figured out how to model incomplete information and found that it gives useful insights. Tony Brewer University of Bristol ------------ FOOTER TO HES POSTING ------------ For information, send the message "info HES" to [log in to unmask]