Economic theories Economic theories The American System was an economic regime pioneered by Henry Clay which created a high tariff to support internal improvements such as road-building. This approach was intended to allow the United States to grow and prosper by themselves, without foreign products or foreign markets. The plan had three main actions. The first was to establish a protective tariff: a tax on imported goods that protects a nation’s business from foreign competition. Congress passed a tariff in 1816 that made European goods more expensive and encouraged consumers to buy relatively cheaper American-made goods. The second action of the American System was to establish a national bank that would promote a single currency, making trade easier. In 1816, Congress created the second Bank of the United States. The third step in the American System was to improve the country’s transportation systems, making trade faster and easier. Poor roads made transportation slow and costly. ...more on Wikipedia about "American System (economics)"
Anarchist economics entails theory and practice relating to economic activity within the philosophical outlines of anarchism. Anarchists primarily oppose capitalism because its characteristic institutions including hierarchical production relations, collecting rents from private property, taking a profit in exchanges, and collecting interest on loans, promote and reproduce various forms of oppression. The goal of anarchist economics is therefore to create or spread economic ideas and systems that foster their vision of responsible human freedom in diversity. Anarchist economics differs from some forms of Marxism in that anarchists tend to see the state as an inherently oppressive social structure that cannot be reformed. They therefore tend to disavow most strategies that advocate popular seizure of the machinery of the state as a stepping stone towards the realization of a just society. According to the anarchists, the achievement of a sustainable, non-hierarchical society based upon cooperation that equitably harnesses the economy to foster the development of well-rounded individualities is to be achieved through grassroots action independent of institutions of domination and control, thereby maintaining an equitable, free and just society. ...more on Wikipedia about "Anarchist economics"
The Austrian School is a school of economic thought that rejects opposing economists' reliance on methods used in natural science for the study of human action, and instead bases its formalism of economics on relationships through logic or introspection called " praxeology." Its most famous adherents are Carl Menger, Eugen von Böhm-Bawerk, Friedrich von Wieser, Ludwig von Mises, Friedrich Hayek, Murray Rothbard, Israel Kirzner and Hans-Hermann Hoppe. While often controversial, and standing to some extent outside of the mainstream of neoclassical theory — as well as being staunchly against much of Keynes' theory and its results — the Austrian School has been widely influential because of its emphasis on the creative phase of economic productivity and their questioning of the basis of the behavioral theory underlying neoclassical economics. The Austrian School is generally associated with groups that label themselves classical liberals or libertarian in their ideas of social, political and economic organization. ...more on Wikipedia about "Austrian School"
(Bullionism) ===The Theory & Its Origins=== ...more on Wikipedia about "Bullionism"
The classical dichotomy theory refers to the division between real and nominal variables in economics. Real variables as output, unemployment, or real interest rates do not necessarily have to be influenced by changes in nominal variables, as most importantly the nominal money supply. Changes in the money supply therefore do not - according to the strict dichotomy - influence real variables ( monetary neutrality). The classical dichotomy was central to the thinking of early economists (money as a veil). ...more on Wikipedia about "Classical dichotomy"
Classical economics is a school of economic thought whose major developers include William Petty, Adam Smith, David Ricardo, Thomas Malthus, John Stuart Mill and Johann Heinrich von Thünen. It is seen by many as the first modern school of economic thought. Some authors, such as John Maynard Keynes expand the definition of classical economics to include Karl Marx. ...more on Wikipedia about "Classical economics"
The Cobweb model or Cobweb theory explains why prices in certain markets are subject to periodic fluctuation. It is an economic model of cyclical supply and demand in which there is a lag between response of producers to a change of price. Farming is a good example, as there is a lag between planting and harvesting. ...more on Wikipedia about "Cobweb model" Connect with http://www.shortopedia.com. Economic_theories
Consumer theory relates preferences, indifference curves and budget constraints to consumer demand curves. ...more on Wikipedia about "Consumer theory"
Coordinatorism is an economic system in which control is held neither by people who own capital, nor by the workers, but instead is held by an intervening class of coordinators, typically in the roles of managers, administrators, engineers, university intellectuals, doctors, lawyers. ...more on Wikipedia about "Coordinatorism"
Cost the limit of price was a maxim coined by Josiah Warren that holds that it is unethical to charge a higher price for a commodity than the cost of purchasing, producing or acquiring, and bringing it to market. ...more on Wikipedia about "Cost the limit of price"
In economics, the cost-of-production theory of value is the belief that the value of an object is decided by the resources that went into making it. The cost can be composed of any of the factors of production including labour, capital, land, or technology. ...more on Wikipedia about "Cost-of-production theory of value"
Creditary economics is a broad and inclusive term for all theories of ...more on Wikipedia about "Creditary economics"
In marketing, the decoy effect (also called the asymmetric dominance effect) is used to describe the phenomenon of greater consumer preference for an item in a two-item choice set caused by the addition to the choice set of a third item that is asymmetrically dominated. An asymmetrically dominated item is in one way better than one of the items, but in no way better than the other item. ...more on Wikipedia about "Decoy effect"
The Natural Rate of Unemployment (NRU) is the equilibrium level of unemployment to which the economy tends, as defined by Milton Friedman's misperception model of labour markets. This model assumes that, in the long-run, labour markets clear (i.e. supply of and demand for labour are equal at a single wage rate and level of employment). According to this hypothesis, unanticipated inflation can cause money illusion: workers will ask for low nominal wage increases and think that their real wages are rising when in fact the real wage rate is falling. The workers' misperception will cause them to increase their labour supply, whilst the actual fall in real wages will cause firms to increase their labour demand, causing an overall increase in employment and output. ...more on Wikipedia about "Differences between the Natural Rate of Unemployment and the NAIRU"
The ecological model of competition is a reassessment of the nature of competition in the economy. Traditional economics models the economy on the priciples of physics (force, equilibrium, inertia, momentum, and linear relationships). This can be seen in the economics lexicon : terms like labour force, market equilibrium, capital flows, and price elasticity. This is probably due to historical coincidence. Classical Newtonian physics was the state of the art in science when Adam Smith was formulating the first principles of economics in the 1700s. ...more on Wikipedia about "Ecological model of competition"
Economic conversion, also known as defence conversion and arms conversion, is a technical, economic and political process for moving from military to civilian markets. Economic conversion takes place on several levels and can be applied to different organizations. In terms of levels (roughly corresponding to geographic scales), conversion can take place at the level of new innovation projects, divisions within multi-divisional firms, companies, and national economies. In terms of objects, conversion can be govern workers (for example through retraining), firms (in terms of workers, capital, facilities and real estate) and land (in terms of real estate). Some of these scales obviously overlap. The organizations that can be converted include: defense firms, military bases, and defense laboratories. ...more on Wikipedia about "Economic conversion"
The Basic Economic Problem is a term used in economic theorem. It outlines that there are limited resources for infinite human wants or scarcity. It involves what goods and services an economy should produce, for example should the emphasis be on public services, housing, agriculture or manufacturing. It also determines how the goods and services should be produced, capital or labour intensive and the efficiency. ...more on Wikipedia about "Economic Problem"
An economic system is a mechanism which deals with the production, distribution and consumption of goods and services in a particular society. ...more on Wikipedia about "Economic system"
Efficient market theory is a field of economics which seeks to explain the workings of capital markets such as the stock market. According to University of Chicago economist Eugene Fama, the price of a stock reflects a balanced rational assessment of its true underlying value (i.e., rational expectations); its price will have fully and accurately discounted (taken account of) all available information (news). ...more on Wikipedia about "Efficient market theory"
Employee-owned corporations are generally a model of ownership of a corporation where the corporation is owned in part or whole by the employees who work for it. Employees are usually given a share of the corporation after a certain length of employment or they can buy shares at any time. A 100% employee-owned corporation is entirely owned by its employees and thus shares are not sold on public stock markets. Employee owned corporations often adopt profit sharing where the profits of the corporation is shared with the employees. These types of corporations also often have boards of directors elected directly by the employees. In the USA, employee-owned corporations are often created through Employee Stock Ownership Plans (ESOPs). ...more on Wikipedia about "Employee-owned corporation"
In economics, endogenous growth theory or new growth theory was developed in the 1980s as a response to criticism of the neo-classical growth model. ...more on Wikipedia about "Endogenous growth theory"
Equilibrium price is the price at which the quantity demanded of a good or service is equal to the quantity supplied. A market that is in a state of equilibrium is considered to be efficient, and is a prerequisite condition of a healthy economy. ...more on Wikipedia about "Equilibrium price"
The Historical school of economics was a mainly German school of economic thought which held that a study of history was the key source of knowledge about human actions and economic matters, since economics would be culture-specific and not generalizable over space and time. This was a rejection of the idea that economic theorems could be held as universally valid. They saw economics as being the work of rigorous analysis and not of logical philosophy. Characteristic of the historical school is a concern with reality rather than with self-referential mathematical modelling; most protagonists of the school were also Kathedersozialisten, i.e. concerned with social reform and the improvement of the masses during the times of heavy industrialization. ...more on Wikipedia about "Historical school of economics"
The Hubbert peak theory, also known as "peak oil", concerns the long-term rate of conventional oil (and other fossil fuel) extraction and depletion. It is named after American geophysicist M. King Hubbert, who created a model of known reserves, and proposed, in 1956, in a paper he presented ** at a meeting of the American Petroleum Institute, that oil production in the continental United States would peak between 1965 and 1970; and that world production would peak in 2000. ...more on Wikipedia about "Hubbert peak theory"
The just price is a theory of ethics in economics that attempted to set standards of fairness in transactions. With intellectual roots in ancient Greek philosophy, it was advanced by Thomas Aquinas based on an argument against usury, which in his time referred to the making of any rate of interest on loans. ...more on Wikipedia about "Just price"
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