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According to Don Patinkin, the concept of monetary neutrality goes back as far as David Hume.The term itself was first used by continental economists beginning at the turn of the 20th century, and exploded as a special topic in the English language economic literature upon Friedrich Hayek's introduction of the term [4] and concept in his famous 1931 LSE lectures published as Prices and ...
In the late 19th century there was much talk about improving the efficiency of the administration and economic performance of the British Empire. [ 31 ] National Efficiency was an attempt to discredit the old-fashioned habits, customs and institutions that put the British at a handicap in competition with the world, especially with Germany ...
In microeconomics, economic efficiency, depending on the context, is usually one of the following two related concepts: [1] Allocative or Pareto efficiency : any changes made to assist one person would harm another.
The revolution was primarily a change in mainstream economic views and in providing a unified framework – many of the ideas and policy prescriptions advocated by Keynes had ad hoc precursors in the underconsumptionist school of 19th-century economics, and some forms of government stimulus were practiced in 1930s United States without the intellectual framework of Keynesianism.
This principle is so well established that economists call it the "law of diminishing marginal utility" and it is reflected in the concave shape of most utility functions. [13] This concept is fundamental to understanding a variety of economic phenomena, such as time preference and the value of goods. Assumptions -
The system is by itself not moving towards any sort of balance between forces, but is constantly on the move away from such a situation. In the normal case a change does not call forth countervailing changes but, instead, supporting changes, which move the system in the same direction as the first change but much further.
Changes in economic conditions are inevitable; and even if they were not, the transition to socialism would be so chaotic as to preclude the existence of such a steady-state from the start. [ 1 ] The purpose of the price mechanism is to allow individuals to recognise the opportunity cost of decisions.
It tells economists, primarily, how not to do economic analyses. The Lucas critique suggests that if we want to predict the effect of a policy experiment, we should model the "deep parameters" (relating to preferences , technology , and resource constraints ) that are assumed to govern individual behavior: so-called " microfoundations ."