 Face-to-face trading interactions on the New York Stock Exchange trading floor. Financial decisions can be one of those many economic choices people make. Economics is the social science that studies the production, distribution, and consumption of goods and services. The term economics comes from the Greek for oikos (house) and nomos (custom or law), hence "rules of the house(hold)."[1] The date of this image, (obtained from the file name of the source image) appears to be 6 April 2001. ...
The date of this image, (obtained from the file name of the source image) appears to be 6 April 2001. ...
The New York Stock Exchange (NYSE), nicknamed the Big Board, is a New York City-based stock exchange. ...
The social sciences are a group of academic disciplines that study human aspects of the world. ...
Distribution in economics is the way total output and income from it is distributed among individuals and among factors of production (such as between labor and capital) (Samuelson and Nordhaus, 2001, p. ...
A good or commodity in economics is any object or service that increases utility, directly or indirectly, not be confused with good in a moral or ethical sense (see Utilitarianism and consequentialist ethical theory). ...
A definition that captures much of modern economics is that of Lionel Robbins in a 1932 essay: "the science which studies human behaviour as a relationship between ends and scarce means which have alternative uses."[2] Scarcity means that available resources are insufficient to satisfy all wants and needs. Absent scarcity and alternative uses of available resources, there is no economic problem. The subject thus defined involves the study of choices as they are affected by incentives and resources.
Lionel Charles Robbins, Baron Robbins (1898 - 1984) was a British economist of the 20th century who proposed one of the early contemporary definitions of economics, Economics is a science which studies human behavior as a relationship between ends and scarce means which have alternative uses. ...
Lionel Robbins Essay (1932, 2nd ed. ...
In economics, scarcity is defined as a condition of limited resources, where society does not have sufficient resources to produce enough to fulfill subjective wants. ...
Classical economics distinguishes between three factors of production which are used in the production of goods: Land or natural resources - naturally-occurring goods such as soil and minerals. ...
The basic economic problem is a term used in economic theory. ...
Rational choice theory assumes human behavior is guided by instrumental reason. ...
Areas of economics may be divided or classified into various types, including:
One of the uses of economics is to explain how economies, as economic systems, work and what the relations are between economic players (agents) in the larger society. Methods of economic analysis have been increasingly applied to fields that involve people (officials included) making choices in a social context, such as crime,[3] education,[4] the family, health, law, politics, religion,[5] social institutions, and war.[6] Microeconomics (or price theory) is a branch of economics that studies how individuals, households, and firms make decisions to allocate limited resources,[1] typically in markets where goods or services are being bought and sold. ...
Circulation in macroeconomics Macroeconomics is a branch of Economics that deals with the performance, structure, and behavior of the economy as a whole. ...
Positive economics, value-free economics or wertfrei economics (from the German wertfrei, meaning value-free) is the part of economics that focuses on facts and cause-and-effect relationships. ...
Normative economics is the branch of economics that incorporates value judgments about what the economy should be like or what particular policy actions should be recommended to achieve a desirable goal. ...
Mainstream economics is the term used to distinguish the economics profession in general from advocates of various heterodox schools, including Austrian economics and Marxian economics. ...
Heterodox economics [1] refers to approaches or schools of economic thought that do not conform to mainstream economics, which has largely developed from neoclassical economics in the late 19th century. ...
Articles in economics journals are usually classified according to the system used by the Journal of Economic Literature (JEL). ...
In economics, an agent is an element of a model who solves an optimization problem. ...
The family, although recognized as fundamental from Adam Smith on, received little systematic treatment in economics before the 1950s. ...
Law and economics, or economic analysis of law is an approach to legal theory that applies methods of economics to law. ...
Public choice theory is a branch of economics that studies the decision-making behavior of voters, politicians and government officials from the perspective of economic theory. ...
Institutional economics focuses on understanding the role of human-made institutions in shaping economic behavior. ...
In the beginning Although discussions about production and distribution have a long history, economics in its modern sense is conventionally dated from the publication of Adam Smith's The Wealth of Nations in 1776.[7] In this work Smith describes the subject in these practical and exacting terms: Download high resolution version (1456x2173, 850 KB) This image has been released into the public domain by the copyright holder, its copyright has expired, or it is ineligible for copyright. ...
Download high resolution version (1456x2173, 850 KB) This image has been released into the public domain by the copyright holder, its copyright has expired, or it is ineligible for copyright. ...
Year 1776 (MDCCLXXVI) was a leap year starting on Monday (link will display the full calendar) of the Gregorian calendar (or a leap year starting on Thursday of the 11-day slower Julian calendar). ...
Revisions and sourced additions are welcome; please only include historical figures. ...
For other persons named Adam Smith, see Adam Smith (disambiguation). ...
Adam Smith An Inquiry into the Nature and Causes of the Wealth of Nations is the magnum opus of the Scottish economist Adam Smith, published on March 9, 1776 during the Scottish Enlightenment. ...
- Political economy, considered as a branch of the science of a statesman or legislator, proposes two distinct objects: first, to supply a plentiful revenue or product for the people, or, more properly, to enable them to provide such a revenue or subsistence for themselves; and secondly, to supply the state or commonwealth with a revenue sufficient for the public services. It proposes to enrich both the people and the sovereign.
Smith referred to the subject as 'political economy', but that term was gradually replaced in general usage by 'economics' after 1870. The Politics series Politics Portal This box: Political economy was the original term for the study of production, the acts of buying and selling, and their relationships to laws, customs and government. ...
Areas of economics Areas of economics may be classified in various ways, but an economy is usually analyzed by use of microeconomics or macroeconomics.
Microeconomics -
Microeconomics examines the economic behavior of agents (including individuals and firms) and their interactions through individual markets, given scarcity and government regulation. A given market might be for a product, say fresh corn, or the services of a factor of production, say bricklaying. The theory considers aggregates of quantity demanded by buyers and quantity supplied by sellers at each possible price per unit. It weaves these together to describe how the market may reach equilibrium as to price and quantity or respond to market changes over time. This is broadly termed demand-and-supply analysis. Market structures, such as perfect competition and monopoly, are examined as to implications for behavior and economic efficiency. Analysis often proceeds from the simplifying assumption that behavior in other markets remains unchanged, that is, partial-equilibrium analysis. General-equilibrium theory allows for changes in different markets and aggregates across all markets, including their movements and interactions toward equilibrium.[8][9] Microeconomics (or price theory) is a branch of economics that studies how individuals, households, and firms make decisions to allocate limited resources,[1] typically in markets where goods or services are being bought and sold. ...
In economics, an agent is an element of a model who solves an optimization problem. ...
Government regulation involves the use of the law, mandated by the state, to produce outcomes which might not otherwise occur, prevent outcomes which might otherwise occur, produce or prevent outcomes in different places to what might otherwise occur, or produce or prevent outcomes in different timescales than would otherwise occur. ...
Classical economics distinguishes between three factors of production which are used in the production of goods: Land or natural resources - naturally-occurring goods such as soil and minerals. ...
In statistics, aggregate data describes data combined from several measurements. ...
The supply and demand model describes how prices vary as a result of a balance between product availability at each price (supply) and the desires of those with purchasing power at each price (demand). ...
Perfect competition is an economic model that describes a hypothetical market form in which no producer or consumer has the market power to influence prices. ...
This article is about the economics of markets dominated by a single seller. ...
There are several measures of economic efficiency: Pareto efficiency Kaldor-Hicks efficiency X-efficiency Allocative efficiency For applications of these principles see: Efficient market hypothesis Welfare economics Production theory basics See also Business efficiency Inefficiency ...
Definition A partial equilibrium is a special case of the general economic equilibrium, where the clearance on the market of some specific goods is obtained independently from prices and quantities demanded and supplied on other goods markets. ...
General Equilibrium (linear) supply and demand curves. ...
Macroeconomics -
Macroeconomics examines the economy as a whole "top down" to explain broad aggregates and their interactions. Such aggregates include national income and output, the unemployment rate, and price inflation and subaggregates like total consumption and investment spending and their components. It also studies effects of monetary policy and fiscal policy. Since at least the 1960s, macroeconomics has been characterized by further integration as to micro-based modeling of sectors, including rationality of players, efficient use of market information, and imperfect competition.[10] This has addressed a long-standing concern about inconsistent developments of the same subject.[11] Analysis also considers factors affecting the long-term level and growth of national income within a country and across countries.[12][13] Circulation in macroeconomics Macroeconomics is a branch of Economics that deals with the performance, structure, and behavior of the economy as a whole. ...
Template:Push up GNP redirects here. ...
It has been suggested that monetary theory be merged into this article or section. ...
Fiscal policy is the economic term that defines the set of principles and decisions of a government in setting the level of public expenditure and how that expenditure is funded. ...
In economics, the term microfoundations refers to the microeconomic analysis of the behavior of individual agents such as households or firms that underpins a macroeconomic theory (Barro, 1993, Glossary, p. ...
Rational expectations is a theory in economics originally proposed by John F. Muth (1961) and later developed by Robert E. Lucas Jr. ...
In finance, the efficient market hypothesis (EMH) asserts that financial markets are informationally efficient, or that prices on traded assets, e. ...
In economic theory, imperfect competition, is the competitive situation in any market where the conditions necessary for perfect competition are not satisfied. ...
World GDP/capita changed very little for most of human history before the industrial revolution. ...
Related fields, other distinctions, and classifications Recent developments closer to microeconomics include behavioral economics and experimental economics. Fields bordering on other social sciences include economic geography, economic history, public choice, cultural economics, and institutional economics. Nobel Prize in Economics winner Daniel Kahneman, was an important figure in the development of behavioral finance and economics and continues to write extensively in the field. ...
Experimental economics is the use of experimental methods to evaluate theoretical predictions of economic behaviour. ...
The social sciences are a group of academic disciplines that study human aspects of the world. ...
Economic geography is the study of the location, distribution and spatial organisation of economic activities across the Earth. ...
Economic history is the study of economic change, and of economic phenomena in the past. ...
Public choice theory is a branch of economics that studies the decision-making behavior of voters, politicians and government officials from the perspective of economic theory. ...
Articles in economics journals are usually classified according to the system used by the Journal of Economic Literature (JEL). ...
Institutional economics focuses on understanding the role of human-made institutions in shaping economic behavior. ...
Another division of the subject distinguishes two types of economics. Positive economics ("what is") seeks to explain economic phenomena or behavior. Normative economics ("what ought to be," often as to public policy) prioritizes choices and actions by some set of criteria; such priorities reflect value judgments, including selection of the criteria. Positive economics, value-free economics or wertfrei economics (from the German wertfrei, meaning value-free) is the part of economics that focuses on facts and cause-and-effect relationships. ...
Normative economics is the branch of economics that incorporates value judgments about what the economy should be like or what particular policy actions should be recommended to achieve a desirable goal. ...
Another distinction is between mainstream economics and heterodox economics. One broad characterization describes mainstream economics as dealing with the "rationality-individualism-equilibrium nexus" and heterodox economics as defined by a "institutions-history-social structure nexus." [14] Mainstream economics is the term used to distinguish the economics profession in general from advocates of various heterodox schools, including Austrian economics and Marxian economics. ...
Heterodox economics [1] refers to approaches or schools of economic thought that do not conform to mainstream economics, which has largely developed from neoclassical economics in the late 19th century. ...
The JEL classification codes of the Journal of Economic Literature provide a comprehensive, detailed way of classifying and searching for economics articles by subject matter. An alternative classification of often-detailed entries by mutually-exclusive categories and subcategories is The New Palgrave: A Dictionary of Economics (1987).[15] Articles in economics journals are usually classified according to the system used by the Journal of Economic Literature (JEL). ...
The Journal of Economic Literature (JEL) is a leading economic journal published by the American Economic Association. ...
Mathematical and quantitative methods Economics as an academic subject often uses geometric methods, in addition to literary methods. Other general mathematical and quantitative methods are also often used for rigorous analysis of the economy or areas within economics. Such methods include the following.
Mathematical economics -
Mathematical economics refers to application of mathematical methods to represent economic theory or analyze problems posed in economics. It uses such methods as calculus and matrix algebra. Expositors cite its advantage in allowing formulation and derivation of key relationships in an economic model with clarity, generality, rigor, and simplicity.[16] For example, Paul Samuelson's book Foundations of Economic Analysis (1947) identifies a common mathematical structure across multiple fields in the subject. Mathematical economics is the sub-field of economics that explores the mathematical aspects of economic systems. ...
A mathematical problem is a problem that can be solved with the help of mathematics. ...
For other uses, see Calculus (disambiguation). ...
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A diagram of the IS/LM model In economics, a model is a theoretical construct that represents economic processes by a set of variables and a set of logical and quantitative relationships between them. ...
Paul Anthony Samuelson (born May 15, 1915, in Gary, Indiana) is an American neoclassical economist known for his contributions to many fields of economics, beginning with his general statement of the comparative statics method in his 1947 book Foundations of Economic Analysis. ...
Foundations of Economic Analysis is a book by Paul A. Samuelson published in 1947 (Enlarged ed. ...
Econometrics -
Econometrics applies mathematical and statistical methods to analyze data related to economic models. For example, a theory may hypothesize that a person with more education will on average earn more income than person with less education holding everything else equal. Econometric estimates can estimate the magnitude and statistical significance of the relation. Econometrics can be used to draw quantitative generalizations. These include testing or refining a theory, describing the relation of past variables, and forecasting future variables.[17] Econometrics is concerned with the tasks of developing and applying quantitative or statistical methods to the study and elucidation of economic principles. ...
A graph of a bell curve in a normal distribution showing statistics used in educational assessment, comparing various grading methods. ...
Economic data are usually numerical time-series, i. ...
A diagram of the IS/LM model In economics, a model is a theoretical construct that represents economic processes by a set of variables and a set of logical and quantitative relationships between them. ...
In statistics, a result is significant if it is unlikely to have occurred by chance, given that a presumed null hypothesis is true. ...
National accounting -
National accounting is a method for summarizing economic activity of a nation. The national accounts are double-entry accounting systems that provide detailed underlying measures of such information. These include the national income and product accounts (NIPA), which provide estimates for the money value of output and income per year or quarter. NIPA allows for tracking the performance of an economy and its components through business cycles or over longer periods. Price data may permit distinguishing nominal from real amounts, that is, correcting money totals for price changes over time.[18][19] The national accounts also include measurement of the capital stock, wealth of a nation, and international capital flows.[20] Measures of national income and output are used in economics to estimate the value of goods and services produced in an economy. ...
This article does not cite any references or sources. ...
National Income and Product Accounts (NIPA) use double entry accounting to report the monetary value and sources of output produced in a country and the distribution of incomes that production generates. ...
An abstract business cycle The business cycle or economic cycle refers to the ups and downs seen somewhat simultaneously in most parts of an economy. ...
Nominal value is the value of anything expressed in money of the day, versus real value which removes the effect of inflation. ...
Capital has a number of related meanings in economics, finance and accounting. ...
In economics wealth of a person or nation is the value of assets owned minus the value of liabilities owed (to foreigners in the case of a nation) at a point in time. ...
International economics is a branch of economics with two main subdisciplines international trade and international finance. ...
Selected fields
Development and growth economics -
 Chart of World GDP per capita by region over the last 2000 years. GDP per capita is a convenient summary measure of long-term economic development. Growth economics studies factors that explain economic growth – the increase in output per capita of a country over a longer period of time. The same factors are used to explain differences in the level of output per capita between countries, Much-studied factors include the rate of investment, population growth, and technological change. These are represented in theoretical and empirical forms (as in the neoclassical growth model) and in growth accounting. At a more specific level, development economics examines economic aspects of the development process in relatively low-income countries with a focus on methods of promoting economic growth. Approaches in development economics frequently incorporate social and political factors to devise particular plans.[21][22][23][24] World GDP/capita changed very little for most of human history before the industrial revolution. ...
This article does not cite any references or sources. ...
Image File history File links Download high resolution version (1023x783, 44 KB) Summary Data Source: Angus Maddisons World Population, GDP and Per Capita GDP, 1-2003 AD (This Microsoft Excel file can also be read by using the free Open office) at The Groningen Growth and Development Centre. ...
Image File history File links Download high resolution version (1023x783, 44 KB) Summary Data Source: Angus Maddisons World Population, GDP and Per Capita GDP, 1-2003 AD (This Microsoft Excel file can also be read by using the free Open office) at The Groningen Growth and Development Centre. ...
World GDP/capita changed very little for most of human history before the industrial revolution. ...
Per capita is a Latin phrase meaning for each head. ...
Invest redirects here. ...
Theoretical Human population increase from 10,000 BC – 2000 AD. Population growth is the change in population over time, and can be quantified as the change in the number of individuals in a population per unit time. ...
A technological change is a term that is used in economics to describe a change in the set of feasible production possibilities. ...
A central concept in science and the scientific method is that all evidence must be empirical, or empirically based, that is, dependent on evidence or consequences that are observable by the senses. ...
The Exogenous growth model, also known as the Neo-classical growth model or Solow growth model is a term used to sum up the contributions of various authors to a model of long-run economic growth within the framework of neoclassical economics. ...
Growth accounting is a set of theories used in economics to explain economic growth. ...
A developing country is a country with low average income compared to the world average. ...
Economic systems -
Economic systems is the branch of economics that studies the methods and institutions by which societies determine the ownership, direction, and allocaton of economic resources. An economic system of a society is the unit of analysis. Among contemporary systems at different ends of the organizational spectrum are socialist systems and capitalist systems, in which most production occurs in respectively state-run and private enterprises. In between are mixed economies. A common element is the interaction of economic and political influences, broadly described as political economy. Comparative economic systems studies the relative performance and behavior of different economies or systems.[25][26] An economic system is a particular set of social institutions which deals with the production, distribution and consumption of goods and services in a particular society. ...
An institution is a group, tenet, maxim, or organization created by a group of humans. ...
This article refers to an economy controlled by the state. ...
For other uses, see Capitalism (disambiguation). ...
A mixed economy is an economy that contains both private and publically, or state owned (or controlled) enterprises. ...
The Politics series Politics Portal This box: Political economy was the original term for the study of production, the acts of buying and selling, and their relationships to laws, customs and government. ...
Comparative economic systems is the subfield of economics dealing with the comparative study of different systems of economic organization, such as capitalism, socialism, feudalism and the mixed economy. ...
Environmental economics -
Environmental economics is concerned with issues related to degradation, enhancement, or preservation of the environment. In particular, public bads from production or consumption, such as air pollution, can lead to market failure. The subject considers how public policy can be used to correct such failures. Policy options include regulations that reflect cost-benefit analysis or market solutions that change incentives, such as emission fees or redefinition of property rights.[27][28] Environmental economics is a subfield of economics concerned with environmental issues (other usages of the term are not uncommon). ...
A public bad, in green economics, is a good that produces socially undesirable results. ...
Market failure is a term used by economists to describe the condition where the allocation of goods and services by a market is not efficient. ...
Cost-benefit analysis is an important technique for project appraisal: the process of weighing the total expected costs against the total expected benefits of one or more actions in order to choose the best or most profitable option. ...
Emissions trading (or cap and trade) is an administrative approach used to control pollution by providing economic incentives for achieving reductions in the emissions of pollutants. ...
Financial economics -
Financial economics, often simply referred to as finance, is concerned with the allocation of financial resources in an uncertain (or risky) environment. Thus, its focus is on the operation of financial markets, the pricing of financial instruments, and the financial structure of companies.[29] Financial economics is the branch of economics concerned with resource allocation over time. ...
Finance studies and addresses the ways in which individuals, businesses, and organizations raise, allocate, and use monetary resources over time, taking into account the risks entailed in their projects. ...
Lets talk about risk control strategies, anyone with more information and willing to share, please do so. ...
This article does not cite any references or sources. ...
Financial instruments package financial capital in readily tradeable forms - they do not exist outside the context of the financial markets. ...
Gearing ratios redirects here. ...
Game theory -
Game theory is a branch of applied mathematics that studies strategic interactions between agents. In strategic games, agents choose strategies that will maximize their payoff, given the strategies the other agents choose. It provides a formal modeling approach to social situations in which decision makers interact with other agents. Game theory generalizes maximization approaches developed to analyze markets such as the supply and demand model. The field dates from the 1944 classic Theory of Games and Economic Behavior by John von Neumann and Oskar Morgenstern. It has found significant applications in many areas outside economics as usually construed, including formulation of nuclear strategies, ethics, political science, and evolutionary theory.[30] Game theory is a branch of applied mathematics that is often used in the context of economics. ...
Applied mathematics is a branch of mathematics that concerns itself with the mathematical techniques typically used in the application of mathematical knowledge to other domains. ...
Strategy games are typically board games, video or computer games with the players decision-making skills having a high significance in determining the outcome. ...
In economics, an agent is an element of a model who solves an optimization problem. ...
The supply and demand model describes how prices vary as a result of a balance between product availability at each price (supply) and the desires of those with purchasing power at each price (demand). ...
In 1944 Princeton University Press published Theory of Games and Economic Behavior, a book by the mathematician John von Neumann and economist Oskar Morgenstern. ...
For other persons named John Neumann, see John Neumann (disambiguation). ...
Oskar Morgenstern (January 24, 1902 - July 26, 1977) was an German- American economist who, working with John von Neumann, helped found the mathematical field of game theory. ...
Wikipedia does not yet have an article with this exact name. ...
Game theory is a branch of applied mathematics that is often used in the context of economics. ...
Game theory is a branch of applied mathematics that is often used in the context of economics. ...
This article is about biological evolution. ...
Industrial organization -
Industrial organization studies the strategic behavior of firms, the structure of markets and their interactions. The common market structures studied include perfect competition, monopolistic competition, various forms of oligopoly, and monopoly.[31] Industrial organization is the field of economics that studies the behavior of firms, the structure of markets and of their interactions. ...
Perfect competition is an economic model that describes a hypothetical market form in which no producer or consumer has the market power to influence prices. ...
Monopolistic competition is a common market form. ...
This article does not cite any references or sources. ...
This article is about the economics of markets dominated by a single seller. ...
Information economics -
Information economics examines how information (or a lack of it) affects economic decision-making. An important focus is the concept of information asymmetry, where one party has more or better information than the other. The existence of information asymmetry gives rise to problems such as moral hazard, and adverse selection, studied in contract theory. The economics of information has relevance in many fields, including finance, insurance, contract law, and decision-making under risk and uncertainty. Information economics is a branch of microeconomic theory (classified under JEL code D8) that studies how information affects economic decisions. ...
In economics and contract theory, an information asymmetry is present when one party to a transaction has more or better information than the other party. ...
This section is studied by Argagui monopoli In law and economics, moral hazard is the name given to the risk that one party to a contract can change their behaviour to the detriment of the other party once the contract has been concluded. ...
Adverse selection or anti-selection is a term used in economics and insurance. ...
Contract theory comprises many different theories and various interpretations of the various body of rules and subrules that define Contract Law. ...
Finance studies and addresses the ways in which individuals, businesses, and organizations raise, allocate, and use monetary resources over time, taking into account the risks entailed in their projects. ...
Insurance, in law and economics, is a form of risk management primarily used to hedge against the risk of a contingent loss. ...
A contract is any promise or set of promises made by one party to another for the breach of which the law provides a remedy. ...
International economics -
International trade studies the determinants of the flow of goods and services across international boundaries. International finance is a macroeconomic field which examines the flow of capital across international borders, and the effects of these movements on exchange rates. Increased trade in goods, services and capital between countries is a major effect of contemporary globalization. International trade is the exchange of goods and services across international boundaries or territories. ...
International finance is the branch of economics that studies the dynamics of exchange rates, foreign investment, and how these affect international trade. ...
International finance is the branch of economics that studies the dynamics of exchange rates, foreign investment, and how these affect international trade. ...
Not to be confused with capitol. ...
A KFC franchise in Kuwait. ...
Labour economics -
Labour economics seeks to understand the functioning of the market and dynamics for labour. Labour markets function through the interaction of workers and employers. Labour economics looks at the suppliers of labour services (workers), the demanders of labour services (employers), and attempts to understand the resulting patterns of wages and other labour income and of employment and unemployment, Practical uses include assisting the formulation of full employment of policies.[32] Construction workers generally work long hours for their pay Labor economics seeks to understand the functioning of the market and dynamics for labor. ...
Look up Market in Wiktionary, the free dictionary. ...
In classical economics and all micro-economics labour is a measure of the work done by human beings and is one of three factors of production, the others being land and capital. ...
Labour economics seeks to understand the functioning of the market for labour. ...
In economics, full employment has more than one meaning. ...
Law and economics -
Law and economics, or economic analysis of law, is an approach to legal theory that applies methods of economics to law. It includes the use of economic concepts to explain the effects of laws, to assess which legal rules are economically efficient, and to predict what the legal rules will be.[33][34] A seminal article by Ronald Coase published in 1961 suggested that well-defined property rights could overcome the problems of externalities.[35] Law and economics, or economic analysis of law is an approach to legal theory that applies methods of economics to law. ...
There are several measures of economic efficiency: Pareto efficiency Kaldor-Hicks efficiency X-efficiency Allocative efficiency For applications of these principles see: Efficient market hypothesis Welfare economics Production theory basics See also Business efficiency Inefficiency ...
Ronald Harry Coase (b. ...
An externality occurs in economics when a decision (for example, to pollute the atmosphere) causes costs or benefits to individuals or groups other than the person making the decision. ...
Managerial economics -
Managerial economics applies microeconomic analysis to specific decisions in business firms or other management units. It draws heavily from quantitative methods such as operations research and programming and from statistical methods such as regression analysis in the absence of certainty and perfect knowledge. A unifying theme is the attempt to optimize business decisions, including unit-cost minimization and profit maximization, given the firm's objectives and constraints imposed by technology and market conditons.[36] [37] Managerial economics (also called business economics), is a branch of economics that applies microeconomic analysis to specific business decisions. ...
Microeconomics is the study of the economic behaviour of individual consumers, firms, and industries and the distribution of production and income among them. ...
Operations Research or Operational Research (OR) is an interdisciplinary branch of mathematics which uses methods like mathematical modeling, statistics, and algorithms to arrive at optimal or good decisions in complex problems which are concerned with optimizing the maxima (profit, faster assembly line, greater crop yield, higher bandwidth, etc) or minima...
In statistics, regression analysis examines the relation of a dependent variable (response variable) to specified independent variables (explanatory variables). ...
In mathematics, the term optimization, or mathematical programming, refers to the study of problems in which one seeks to minimize or maximize a real function by systematically choosing the values of real or integer variables from within an allowed set. ...
Public finance -
Public finance is the field of economics that deals with budgeting the revenues and expenditures of a public sector entity, usually government. The subject addresses such matters as tax incidence (who really pays a particular tax), cost-benefit analysis of government programs, effects on economic efficiency and income distribution of different kinds of spending and taxes, and fiscal politics. The latter, an aspect of public choice theory, models public-sector behavior analogously to microeconomics, involving interactions of self-interested voters, politicians, and bureaucrats.[38] This article does not cite any references or sources. ...
< [[[[math>Insert formula here</math>The public sector is that part of economic and administrative life that deals with the delivery of goods and services by and for the [[government </math></math></math></math> Direct administration funded through taxation; the delivering organisation generally has no specific requirement to meet commercial...
First discussed by the Physiocrats in France, tax incidence is the analysis of the effect of a particular tax on the distribution of economic welfare. ...
There are several measures of economic efficiency: Pareto efficiency Kaldor-Hicks efficiency X-efficiency Allocative efficiency For applications of these principles see: Efficient market hypothesis Welfare economics Production theory basics See also Business efficiency Inefficiency ...
This graphic shows the distribution of gross annual household income. ...
Public choice theory is a branch of economics that studies the decision-making behavior of voters, politicians and government officials from the perspective of economic theory, namely game theory and decision theory. ...
Welfare economics -
Welfare economics is a branch of economics that uses microeconomic techniques to simultaneously determine the allocative efficiency within an economy and the income distribution associated with it. It attempts to measure social welfare by examining the economic activities of the individuals that comprise society.[39] Welfare economics is a branch of economics that uses microeconomic techniques to simultaneously determine the allocational efficiency of a macroeconomy and the income distribution associated with it. ...
Microeconomics (or price theory) is a branch of economics that studies how individuals, households, and firms make decisions to allocate limited resources,[1] typically in markets where goods or services are being bought and sold. ...
Allocative efficiency is the market condition whereby resources are allocated in a way that maximizes the net benefit attained through their use. ...
Distribution in economics is the way total output and income from it is distributed among individuals and among factors of production (such as between labor and capital) (Samuelson and Nordhaus, 2001, p. ...
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Economic concepts
Supply and demand -
 The supply and demand model describes how prices vary as a result of a balance between product availability and demand. The graph depicts an increase (that is, right-shift) in demand from D 1 to D 2 along with the consequent increase in price and quantity required to reach a new equilibrium point on the supply curve (S). The theory of demand and supply is an organizing principle to explain prices and quantities of goods sold and changes thereof in a market economy. In microeconomic theory, it refers to price and output determination in a perfectly competitive market. This has served as a building block for modeling other market structures and for other theoretical approaches. The supply and demand model describes how prices vary as a result of a balance between product availability at each price (supply) and the desires of those with purchasing power at each price (demand). ...
Image File history File links Supply-demand-right-shift-demand. ...
Image File history File links Supply-demand-right-shift-demand. ...
The supply and demand model describes how prices vary as a result of a balance between product availability at each price (supply) and the desires of those with purchasing power at each price (demand). ...
Look up Market in Wiktionary, the free dictionary. ...
Microeconomics (or price theory) is a branch of economics that studies how individuals, households, and firms make decisions to allocate limited resources,[1] typically in markets where goods or services are being bought and sold. ...
Perfect competition is an economic model that describes a hypothetical market form in which no producer or consumer has the market power to influence prices. ...
For a given market of a commodity, demand shows the quantity that all prospective buyers would be prepared to purchase at each unit price of the good. Demand is often represented using a table or a graph relating price and quantity demanded (see boxed figure). Demand theory describes individual consumers as "rationally" choosing the most preferred quantity of each good, given income, prices, tastes, etc. A term for this is 'constrained utility maximization' (with income as the "constraint" on demand). Here, 'utility' refers to the (hypothesized) preference relation for individual consumers. Utility and income are then used to model hypothesized properties about the effect of a price change on the quantity demanded. The law of demand states that, in general, price and quantity demanded in a given market are inversely related. In other words, the higher the price of a product, the less of it people would be able and willing buy of it (other things unchanged). As the price of a commodity rises, overall purchasing power decreases (the income effect) and consumers move toward relatively less expensive goods (the substitution effect). Other factors can also affect demand; for example an increase in income will shift the demand curve outward relative to the origin, as in the figure. A good or commodity in economics is any object or service that increases utility, directly or indirectly, not be confused with good in a moral or ethical sense (see Utilitarianism and consequentialist ethical theory). ...
Consumer theory is a theory of economics. ...
Rational choice theory assumes human behavior is guided by instrumental reason. ...
Consumer theory is a theory of economics. ...
In economics, utility is a measure of the relative happiness or satisfaction (gratification) gained. ...
Ceteris paribus is a Latin phrase, literally translated as with other things [being] the same, and usually rendered in English as all other things being equal. ...
Purchasing Power- the amount of value of a good/services compared to the amount paid. ...
Consumer theory relates preferences, indifference curves and budget constraints to consumer demand curves. ...
Consumer theory relates preferences, indifference curves and budget constraints to consumer demand curves. ...
Supply is the relation between the price of a good and the quantity available for sale from suppliers (such as producers) at that price. Supply is often represented using a table or graph relating price and quantity supplied. Producers are hypothesized to be profit-maximizers, meaning that they attempt to produce the amount of goods that will bring them the highest profit. Supply is typically represented as a directly proportional relation between price and quantity supplied (other things unchanged). In other words, the higher the price at which the good can be sold, the more of it producers will supply. The higher price makes it profitable to increase production. At a price below equilibrium, there is a shortage of quantity supplied compared to quantity demanded. This pulls the price up. At a price above equilibrium, there is a surplus of quantity supplied compared to quantity demanded. This pushes the price down. The model of supply and demand predicts that for a given supply and demand curve, price and quantity will stabilize at the price that makes quantity supplied equal to quantity demanded. This is at the intersection of the two curves in the graph above, market equilibrium. A diagram of the IS/LM model In economics, a model is a theoretical construct that represents economic processes by a set of variables and a set of logical and quantitative relationships between them. ...
It has been suggested that Equilibrium price be merged into this article or section. ...
For a given quantity of a good, the price point on the demand curve indicates the value, or marginal utility[40] to consumers for that unit of output. It measures what the consumer would be prepared to pay for the corresponding unit of the good. The price point on the supply curve measures marginal cost, the increase in total cost to the supplier for the corresponding unit of the good. The price in equilibrium is determined by supply and demand. In a perfectly competitive market, supply and demand equate cost and value at equilibrium.[41] “Marginal revolution†redirects here. ...
In economics and finance, marginal cost is the change in total cost that arises when the quantity produced changes by one unit. ...
Perfect competition is an economic model that describes a hypothetical market form in which no producer or consumer has the market power to influence prices. ...
Demand and supply can also be used to model the distribution of income to the factors of production, including labour and capital, through factor markets. In a labour market for example, the quantity of labour employed and the price of labour (the wage rate) are modeled as set by the demand for labour (from business firms etc. for production) and supply of labour (from workers). Distribution in economics is the way total output and income from it is distributed among individuals and among factors of production (such as between labor and capital) (Samuelson and Nordhaus, 2001, p. ...
In economics, factors of production are resources used in the production of goods and services, including land, labor, and capital. ...
Construction workers generally work long hours for their pay Labor economics seeks to understand the functioning of the market and dynamics for labor. ...
Demand and supply are used to explain the behavior of perfectly competitive markets, but their usefulness as a standard of performance extends to any type of market. Demand and supply can also be generalized to explain macroeconomic variables in a market economy, for example, quantity of total output and the general price level. Macroeconomics is the study of the entire economy in terms of the total amount of goods and services produced, total income earned, the level of employment of productive resources, and the general behavior of prices. ...
A market economy (also called a free market economy or a free enterprise economy) is an economic system in which the production and distribution of goods and services take place through the mechanism of free markets guided by a free price system. ...
In economics, the gross domestic product (GDP) is a measure of the amount of the economic production of a particular territory in financial capital terms during a specific time period. ...
The price level is a measurement of the average level of prices in an economy. ...
Prices and quantities -
In supply-and-demand analysis, price, the going rate of exchange for a good, coordinates production and consumption quantities. Price and quantity have been described as the most directly observable characteristics of a good produced for the market.[42] Supply, demand, and market equilibrium are theoretical constructs linking price and quantity. But tracing the effects of factors predicted to change supply and demand -- and through them, price and quantity -- is a standard exercise in applied microeconomics and macroeconomics. Economic theory can specify under what circumstances price demonstrably serves as an efficient communication device to regulate quantity.[43] A real-world counterpart might attempt to measure how much variables that increase supply or demand change price and quantity. In economics and business, the price is the assigned numerical monetary value of a good, service or asset. ...
In economics, the nominal values of something are its money values in different years. ...
Download high resolution version (2392x1561, 621 KB) Wikipedia does not have an article with this exact name. ...
Download high resolution version (2392x1561, 621 KB) Wikipedia does not have an article with this exact name. ...
International trade is the exchange of goods and services across international boundaries or territories. ...
Microeconomics (or price theory) is a branch of economics that studies how individuals, households, and firms make decisions to allocate limited resources,[1] typically in markets where goods or services are being bought and sold. ...
Circulation in macroeconomics Macroeconomics is a branch of Economics that deals with the performance, structure, and behavior of the economy as a whole. ...
Elementary demand-and-supply theory predicts equilibrium but not the speed of adjustment for changes of equilibrium due to a shift in demand or supply.[44] In many areas, some form of "price stickiness" is postulated to account for quantities, rather than prices, adjusting in the short run to changes on the demand side or the supply side. This includes standard analysis of the business cycle in macroeconomics. Analysis often revolves around causes of such price stickiness and their implications for reaching a hypothesized long-run equilibrium. Examples of such price stickiness in particular markets include wage rates in labour markets and posted prices in markets deviating from perfect competition. // [edit] Introduction [edit] Definition If we were to take snapshots of an economy at different points in time, no two photos would look alike. ...
Circulation in macroeconomics Macroeconomics is a branch of Economics that deals with the performance, structure, and behavior of the economy as a whole. ...
Perfect competition is an economic model that describes a hypothetical market form in which no producer or consumer has the market power to influence prices. ...
Another area of economics considers whether markets adequately take account of all social costs and benefits. An externality is said to occur where there are significant social costs or benefits from production or con
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