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In the philosophy of economics, economics is often divided into positive (or descriptive) and normative (or prescriptive) economics.Positive economics focuses on the description, quantification and explanation of economic phenomena, [1] while normative economics discusses prescriptions for what actions individuals or societies should or should not take.
Statements of value (normative or prescriptive statements), which encompass ethics and aesthetics, and are studied via axiology. This barrier between fact and value, as construed in epistemology, implies it is impossible to derive ethical claims from factual arguments, or to defend the former using the latter.
Macroeconomics is a branch of economics that deals with the performance, structure, behavior, and decision-making of an economy as a whole. [1] This includes regional, national, and global economies .
First edition (publ. University of Chicago Press) Milton Friedman's book Essays in Positive Economics (1953) is a collection of earlier articles by the author with as its lead an original essay "The Methodology of Positive Economics."
The General Theory of Employment, Interest and Money is a book by English economist John Maynard Keynes published in February 1936. It caused a profound shift in economic thought, [1] giving macroeconomics a central place in economic theory and contributing much of its terminology [2] – the "Keynesian Revolution". It had equally powerful ...
An example of the Matthew Effect's role on social influence is an experiment by Salganik, Dodds, and Watts in which they created an experimental virtual market named MUSICLAB. In MUSICLAB, people could listen to music and choose to download the songs they enjoyed the most. The song choices were unknown songs produced by unknown bands.
The theory also focuses on positive externalities and spillover effects of a knowledge-based economy which will lead to economic development. The endogenous growth theory primarily holds that the long run growth rate of an economy depends on policy measures.
The accelerator effect in economics is a positive effect on private fixed investment of the growth of the market economy (measured e.g. by a change in gross domestic product (GDP)). Rising GDP (an economic boom or prosperity) implies that businesses in general see rising profits, increased sales and cash flow, and greater use of existing capacity.