What Is Ex Ante Variable

Concepts of Ex-Ante and Ex-Post

To understand ex-ante and ex-post, let us take the example the act of going to a grocery store. You usually plan in advance, the list of items that you wish to buy from the store. When at the store, however, certain items that might not be on your list might interest you and you ‘actually’ end up purchasing more than what you had ‘planned’. What you had planned or what ‘could be’ is called ex-ante, while what actually is, is called ex-post.

Economic variables like consumption, investment, savings, etc. are all defined in terms of ex-ante and ex-post. The above example was that of planned and actual spending. There normally arises a difference or deviation between what is intended or planned and what actually takes place, and the concepts of ex-ante and ex-post account for that.