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In economics, a complementary good is a good whose appeal increases with the popularity of its complement. [ further explanation needed ] Technically, it displays a negative cross elasticity of demand and that demand for it increases when the price of another good decreases. [ 1 ]
The theorem has also raised concerns about the falsifiability of general equilibrium theory, because it seems to imply that almost any observed pattern of market price and quantity data could be interpreted as being the result of individual utility-maximizing behavior. In other words, Sonnenschein–Mantel–Debreu raises questions about the ...
Lange, O (1936). "On the Economic Theory of Socialism I". The Review of Economic Studies. 4 (1): 53–71. doi:10.2307/2967660. JSTOR 2967660. Lange, O 1937 On the Economic Theory of Socialism II The Review of Economic Studies V4 N 123-142; Lange, O 1938 On the Economic Theory of Socialism B Lippincott ed. University of Minnesota Press
In economics and game theory, the decisions of two or more players are called strategic complements if they mutually reinforce one another, and they are called strategic substitutes if they mutually offset one another. These terms were originally coined by Bulow, Geanakoplos, and Klemperer (1985). [1]
The main goal of the new model is to re-frame economic problems and set new goals. In this context, the model is also referred to as a "wake-up call to transform our capitalist worldview". [5] In this model, an economy is considered prosperous when all twelve social foundations are met without overshooting any of the nine ecological ceilings ...
A macroeconomic model is an analytical tool designed to describe the operation of the problems of economy of a country or a region. These models are usually designed to examine the comparative statics and dynamics of aggregate quantities such as the total amount of goods and services produced, total income earned, the level of employment of productive resources, and the level of prices.
A primary theory in this vein is the debt deflation theory of Irving Fisher, which he proposed to explain the Great Depression. A more recent complementary theory is the Financial Instability Hypothesis of Hyman Minsky, and the credit theory of economic cycles is often associated with Post-Keynesian economics such as Steve Keen.
This marked the beginning of a boom in atheoretical, statistical models of economic fluctuation (models based on cycles and trends instead of economic theory) that led to the discovery of apparently regular economic patterns like the Kuznets wave. [10] Other economists focused more on theory in their business cycle analysis.