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Economic Theories
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Supply and Demand
Adam Smith - Describes the relationship between the availability of a commodity and the desire for that commodity.
Evolutionary Economics
Richard R. Nelson and Sidney G. Winter - Draws from evolutionary theory to explain the processes that transform the economy from within.
Rational Expectations
Robert Lucas Jr. - Assumes that economic actors have rational expectations and that they seek to maximize their utility.
Resource-Based Economy
Jacque Fresco - Describes a system in which goods and services are available without the use of money, credits, barter, or any other system of debt or servitude.
Schumpeterian Growth Theory
Joseph Schumpeter - This theory suggests that economic growth is driven by innovation and the entrepreneur’s role in developing new products and services.
Endogenous Growth Theory
Paul Romer - Contends that economic growth is primarily the result of endogenous and not external forces.
New Trade Theory
Paul Krugman - States that through the use of economies of scale, countries can specialize in the production of certain products, which leads to increases in trade between nations.
Keynesian Economics
John Maynard Keynes - Advocates for increased government expenditures and lower taxes to stimulate demand and pull the global economy out of depression.
Behavioral Economics
Daniel Kahneman and Amos Tversky - Integrating insights from psychology into economics, particularly concerning human judgment and decision-making under uncertainty.
Mercantilism
Thomas Mun - Early economic theory that suggests a nation's wealth is measured by its holdings of precious metals and that government should encourage exports and discourage imports.
Modern Monetary Theory
L. Randall Wray - Argues that governments with a sovereign currency can create new money to fund government expenditures and stimulate the economy without the need for taxes or borrowing to balance the budget.
Institutional Economics
Thorstein Veblen - Focuses on the role of institutions and evolving social, legal, and political frameworks in shaping economic behavior.
Ecological Economics
Herman Daly - Considers the long-term impact of economic activity on the environment and sustainable development.
Circular Economy
Ellen MacArthur - Proposes an economic system aimed at minimizing waste and making the most of resources through reuse, repairing, refurbishing and recycling.
Comparative Advantage
David Ricardo - Suggests that countries should specialize in producing goods where they have a lower opportunity cost.
Public Choice Theory
James M. Buchanan - Applies economic principles to political processes, treating a democratic government as a market phenomenon.
Real Business Cycle Theory
Finn E. Kydland and Edward C. Prescott - Attributes fluctuations in the economy to the ebb and flow of technological innovations causing fluctuations in productivity.
New Economic Geography
Paul Krugman - Explains the location, distribution and spatial organization of economic activities across the world.
Post-Keynesian Economics
Joan Robinson - Challenges some of the core axioms of traditional Keynesian economics, and proposes a more complete version that includes uncertainty, banks and money creation.
Chicago School of Economics
Milton Friedman - Advocates for minimal government intervention in the economy and a focus on monetary policy over fiscal policy.
Monetarism
Milton Friedman - Argues that the variation in the money supply has major influences on national output in the short run and the price level over longer periods.
Austrian Economics
Carl Menger - Emphasizes the spontaneous organizing power of the price mechanism and holds that the complexity of subjective human choices makes mathematical modeling of the evolving market impossible.
Game Theory
John Nash - Analyzes strategies employed by individuals or groups when their success depends on the choices of others.
Gross Domestic Product (GDP)
Simon Kuznets - Measures the market value of all the final goods and services produced within a country in a given period of time.
Trickle-Down Economics
Arthur Laffer - Suggests that tax cuts for the rich lead to increased economic activity which will eventually benefit all layers of society.
Development Economics
Amartya Sen - Involves the creation of theories and methods that aid in the determination of policies and practices and can be implemented at both the domestic and international levels to improve socioeconomic conditions.
Principal-Agent Problem
Michael Jensen and William Meckling - Discusses the conflicts that arise when one person (the agent) is able to make decisions on behalf of, or that impact, another person (the principal).
Marxist Economics
Karl Marx - Focuses on the labor theory of value and the exploitation theory which explains the dynamics of capitalist economies.
Neoclassical Economics
Alfred Marshall - Focuses on how the perception of utility and costs influence supply and demand.
Human Capital Theory
Gary Becker - Views human beings as capital assets and evaluates the economic value of an employee’s skill set to an organization.
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