Portal:Economics

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Introduction

Euro coins

Economics (/ˌɛkəˈnɒmɪks, ˌiːkə-/) is a social science that studies the production, distribution, and consumption of goods and services.

Economics focuses on the behaviour and interactions of economic agents and how economies work. Microeconomics analyses what is viewed as the basic elements of economies, including individual agents and markets, their interactions, and the outcomes of those interactions. Individual agents may include households, firms, buyers, and sellers. Macroeconomics analyses economies as systems where production, distribution, consumption, savings, and investment expenditure interact; and the factors of production affecting them, such as: labour, capital, land, and enterprise, inflation, economic growth, and public policies that impact these elements. It also seeks to analyse and describe the global economy. (Full article...)

Selected general articles

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  Georgist campaign button from the 1890s. The cat on the badge refers to the slogan "Do you see the cat?" from a story by Congressman James G. Maguire. He compared understanding the Single Tax to being able to make out a cat in a picture of a landscape.

  
  Georgism, in modern times also called Geoism, and known historically as the single tax movement, is an economic ideology holding that persons (including corporations) should own the value that they produce themselves, while the economic rent derived from land—including from all natural resources, the commons, and urban locations—should belong equally to all members of society. Developed from the writings of American economist and social reformer Henry George, the Georgist paradigm seeks solutions to social and ecological problems based on principles of land rights and public finance that attempt to integrate economic efficiency with social justice.
  
  Georgism is concerned with the distribution of economic rent caused by land ownership, natural monopolies, pollution rights, and control of the commons, including title of ownership for natural resources and other contrived privileges (e.g., intellectual property). Any natural resource that is inherently limited in supply can generate economic rent, but the classical and most significant example of land monopoly involves the extraction of common ground rent from valuable urban locations. Georgists argue that taxing economic rent is efficient, fair, and equitable. The main Georgist policy recommendation is a land value tax (LVT), the revenues from which can be used to reduce or eliminate existing taxes (such as on income, trade, or purchases) that are posited to be unfair and inefficient. Some Georgists also advocate the return of surplus public revenue to the people by means of a basic income or citizen's dividend. (Full article...)
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  This aims to be a complete article list of economics topics: (Full article...)
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  The American School, also known as the National System, represents three different yet related constructs in politics, policy and philosophy. The policy existed from the 1790s to the 1970s, waxing and waning in actual degrees and details of implementation. Historian Michael Lind describes it as a coherent applied economic philosophy with logical and conceptual relationships with other economic ideas.
  
  It is the macroeconomic philosophy that dominated United States national policies from the time of the American Civil War until the mid-20th century. Closely related to mercantilism, it can be seen as contrary to classical economics. It consisted of these three core policies:

  1. Protecting industry through selective high tariffs (especially 1861–1932).
  2. Government investments in infrastructure creating targeted internal improvements (especially in transportation).
  3. A national bank with policies that promote the growth of productive enterprises rather than speculation.

  (Full article...)
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  Microeconomics analyzes the market mechanisms that enable buyers and sellers to establish relative prices among goods and services. Shown is a marketplace in Delhi.

  
  
  Microeconomics is a branch of economics that studies the behavior of individuals and firms in making decisions regarding the allocation of scarce resources and the interactions among these individuals and firms. Microeconomics focuses on the study of individual markets, sectors, or industries as opposed to the economy as a whole, which is studied in macroeconomics.
  
  One goal of microeconomics is to analyze the market mechanisms that establish relative prices among goods and services and allocate limited resources among alternative uses. Microeconomics shows conditions under which free markets lead to desirable allocations. It also analyzes market failure, in which markets fail to produce efficient outcomes. (Full article...)
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  Johann Heinrich von Thünen, age 57

  
  Johann Heinrich von Thünen (24 June 1783 – 22 September 1850), sometimes spelled Thuenen, was a prominent nineteenth-century economist and a native of Mecklenburg-Strelitz, now in northern Germany.
  
  Even though he never held a professorial position, Thünen had substantial influence on economics. He has been described as one of the founders of agricultural economics and economic geography. He made substantial contributions to economic debates on rent, land use, and wages. (Full article...)
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  Stiglitz in 2019

  
  Joseph Eugene Stiglitz (/ˈstɪɡlɪts/; born February 9, 1943) is an American New Keynesian economist, a public policy analyst, political activist, and a professor at Columbia University. He is a recipient of the Nobel Memorial Prize in Economic Sciences (2001) and the John Bates Clark Medal (1979). He is a former senior vice president and chief economist of the World Bank. He is also a former member and chairman of the U.S. Council of Economic Advisers. He is known for his support for the Georgism public finance theory and for his critical view of the management of globalization, of laissez-faire economists (whom he calls "free-market fundamentalists"), and of international institutions such as the International Monetary Fund and the World Bank.
  
  In 2000, Stiglitz founded the Initiative for Policy Dialogue (IPD), a think tank on international development based at Columbia University. He has been a member of the Columbia faculty since 2001 and received the university's highest academic rank (university professor) in 2003. He was the founding chair of the university's Committee on Global Thought. He also chairs the University of Manchester's Brooks World Poverty Institute. He was a member of the Pontifical Academy of Social Sciences. In 2009, the President of the United Nations General Assembly Miguel d'Escoto Brockmann, appointed Stiglitz as the chairman of the U.N. Commission on Reforms of the International Monetary and Financial System, where he oversaw suggested proposals and commissioned a report on reforming the international monetary and financial system. He served as the chair of the international Commission on the Measurement of Economic Performance and Social Progress, appointed by the French President Sarkozy, which issued its report in 2010, Mismeasuring our Lives: Why GDP doesn't add up, and currently serves as co-chair of its successor, the High Level Expert Group on the Measurement of Economic Performance and Social Progress. From 2011 to 2014, Stiglitz was the president of the International Economic Association (IEA). He presided over the organization of the IEA triennial world congress held near the Dead Sea in Jordan in June 2014. (Full article...)
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  In the history of economic thought, a school of economic thought is a group of economic thinkers who share or shared a mutual perspective on the way economies function. While economists do not always fit within particular schools, particularly in the modern era, classifying economists into schools of thought is common. Economic thought may be roughly divided into three phases: premodern (Greco-Roman, Indian, Persian, Islamic, and Imperial Chinese), early modern (mercantilist, physiocrats) and modern (beginning with Adam Smith and classical economics in the late 18th century, and Karl Marx and Friedrich Engels' Marxian economics in the mid 19th century). Systematic economic theory has been developed primarily since the beginning of what is termed the modern era.
  
  Currently, the vast majority of economists follow an approach known as mainstream economics (sometimes called 'orthodox economics'). Economists generally specialize into either macroeconomics, broadly on the general scope of the economy as a whole, or microeconomics, on specific markets or actors. (Full article...)
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  Economics classes make extensive use of supply and demand graphs like this one to teach about markets. In this graph, S and D refer to supply and demand and P and Q refer to the price and quantity.

  The following outline is provided as an overview of and topical guide to economics. Economics is a branch of science that analyzes the production, distribution, and consumption of goods and services. It aims to explain how economies work and how agents (people) respond to incentives.
  
  Economics is a behavioral science (a scientific discipline that focuses on the study of human behavior) as well as a social science (a scientific discipline that explores aspects of human society). (Full article...)
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  Portrait by Thomas Phillips, c. 1821

  
  David Ricardo (18 April 1772 – 11 September 1823) was a British economist and politician. He is recognized as one of the most influential classical economists, alongside figures such as Thomas Malthus, Adam Smith and James Mill.
  
  Ricardo was born in London as the third surviving child of a successful stockbroker and his wife. He came from a Sephardic Jewish family of Portuguese origin. At 21, he eloped with a Quaker and converted to Unitarianism, causing estrangement from his family. He made his fortune financing government borrowing and later retired to an estate in Gloucestershire. Ricardo served as High Sheriff of Gloucestershire and bought a seat in Parliament as an earnest reformer. He was friends with prominent figures like James Mill, Jeremy Bentham, and Thomas Malthus, engaging in debates over various topics. Ricardo was also a member of The Geological Society, and his youngest sister was an author. (Full article...)
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  Robinson in 1973

  
  Joan Violet Robinson FBA (née Maurice; 31 October 1903 – 5 August 1983) was a British economist known for her wide-ranging contributions to economic theory. One of the most prominent economists of the century, Robinson incarnated the "Cambridge School" in most of its guises in the 20th century. She started out as a Marshallian, became one of the earliest and most ardent Keynesians after 1936, and ended up as a leader of the neo-Ricardian and post-Keynesian schools. (Full article...)
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  Tinbergen in 1982

  
  Jan Tinbergen (/ˈtɪnbɜːrɡən/ TIN-bur-gən, Dutch: [jɑn ˈtɪmbɛrɣə(n)]; 12 April 1903 – 9 June 1994) was a Dutch economist who was awarded the first Nobel Memorial Prize in Economic Sciences in 1969, which he shared with Ragnar Frisch for having developed and applied dynamic models for the analysis of economic processes. He is widely considered to be one of the most influential economists of the 20th century and one of the founding fathers of econometrics.
  
  His important contributions to econometrics include the development of the first macroeconometric models, the solution of the identification problem, and the understanding of dynamic models. Tinbergen was a founding trustee of Economists for Peace and Security. In 1945, he founded the Bureau for Economic Policy Analysis (CPB) and was the agency's first director. (Full article...)
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  The attention economy refers to the incentives of advertising-driven companies, in particular, to maximize the time and attention their users give to their product.
  
  Attention economics is an approach to the management of information that treats human attention as a scarce commodity and applies economic theory to solve various information management problems. (Full article...)
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  Possible portrait of Mandeville

  
  Bernard Mandeville, or Bernard de Mandeville (/ˈmændəˌvɪl/; 15 November 1670 – 21 January 1733), was an Anglo-Dutch philosopher, political economist, satirist, writer and physician. Born in Rotterdam, he lived most of his life in England and used English for most of his published works. He became famous for The Fable of the Bees. (Full article...)
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  World GDP per capita, 1400–2003

  
  Economic history is the study of history using methodological tools from economics or with a special attention to economic phenomena. Research is conducted using a combination of historical methods, statistical methods, and the application of economic theory to historical situations and institutions. The field can encompass a wide variety of topics, including equality, finance, technology, labour, and business. It emphasizes historicizing the economy itself, analyzing it as a dynamic entity, and providing insights into how it is structured and conceived.
  
  Using both quantitative data and qualitative sources, economic historians emphasize understanding the historical context in which major economic events take place. They often focus on the institutional dynamics of systems of production, labor, and capital, as well as the economy's impact on society, culture, and language. Scholars of the discipline may approach their analysis from the perspective of different schools of economic thought, such as mainstream economics, Austrian economics, Marxian economics, the Chicago school of economics, and Keynesian economics. (Full article...)
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  Socialist economics comprises the economic theories, practices and norms of hypothetical and existing socialist economic systems. A socialist economic system is characterized by social ownership and operation of the means of production that may take the form of autonomous cooperatives or direct public ownership wherein production is carried out directly for use rather than for profit. Socialist systems that utilize markets for allocating capital goods and factors of production among economic units are designated market socialism. When planning is utilized, the economic system is designated as a socialist planned economy. Non-market forms of socialism usually include a system of accounting based on calculation-in-kind to value resources and goods.
  
  Socialist economics has been associated with different schools of economic thought. Marxian economics provided a foundation for socialism based on analysis of capitalism while neoclassical economics and evolutionary economics provided comprehensive models of socialism. During the 20th century, proposals and models for both socialist planned and market economies were based heavily on neoclassical economics or a synthesis of neoclassical economics with Marxian or institutional economics. (Full article...)
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  Supply-side economics is a macroeconomic theory postulating that economic growth can be most effectively fostered by lowering taxes, decreasing regulation, and allowing free trade. According to supply-side economics theory, consumers will benefit from greater supply of goods and services at lower prices, and employment will increase. Supply-side fiscal policies are designed to increase aggregate supply, as opposed to aggregate demand, thereby expanding output and employment while lowering prices. Such policies are of several general varieties:

  1. Investments in human capital, such as education, healthcare, and encouraging the transfer of technologies and business processes, to improve productivity (output per worker). Encouraging globalized free trade via containerization is a major recent example.
  2. Tax reduction, to provide incentives to work, invest and take risks. Lowering income tax rates and eliminating or lowering tariffs are examples of such policies.
  3. Investments in new capital equipment and research and development (R&D), to further improve productivity. Allowing businesses to depreciate capital equipment more rapidly (e.g., over one year as opposed to 10) gives them an immediate financial incentive to invest in such equipment.
  4. Reduction in government regulations, to encourage business formation and expansion.

  
  
  A basis of supply-side economics is the Laffer curve, a theoretical relationship between rates of taxation and government revenue. The Laffer curve suggests that when the tax level is too high, lowering tax rates will boost government revenue through higher economic growth, though the level at which rates are deemed "too high" is disputed. (Full article...)
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  Real business-cycle theory (RBC theory) is a class of new classical macroeconomics models in which business-cycle fluctuations are accounted for by real, in contrast to nominal, shocks. RBC theory sees business cycle fluctuations as the efficient response to exogenous changes in the real economic environment. That is, the level of national output necessarily maximizes expected utility.
  
  In RBC models, business cycles are described as "real" because they reflect optimal adjustments by economic agents rather than failures of markets to clear. As a result, RBC theory suggests that governments should concentrate on long-term structural change rather than intervention through discretionary fiscal or monetary policy. These ideas are strongly associated with freshwater economics within the neoclassical economics tradition, particularly the Chicago School of Economics. (Full article...)
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  Monetary circuit theory is a heterodox theory of monetary economics, particularly money creation, often associated with the post-Keynesian school.
  It holds that money is created endogenously by the banking sector, rather than exogenously by central bank lending; it is a theory of endogenous money. It is also called circuitism and the circulation approach. (Full article...)
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  Richer countries tend to be happier than poorer countries (observations are lined up around an upward-sloping trend), and richer people within countries tend to be happier than poorer people in the same countries (arrows are consistently pointing northeast).

  
  The economics of happiness or happiness economics is the theoretical, qualitative and quantitative study of happiness and quality of life, including positive and negative affects, well-being, life satisfaction and related concepts – typically tying economics more closely than usual with other social sciences, like sociology and psychology, as well as physical health. It typically treats subjective happiness-related measures, as well as more objective quality of life indices, rather than wealth, income or profit, as something to be maximized.
  
  The field has grown substantially since the late 20th century, for example by the development of methods, surveys and indices to measure happiness and related concepts, as well as quality of life. Happiness findings have been described as a challenge to the theory and practice of economics. Nevertheless, furthering gross national happiness, as well as a specified Index to measure it, has been adopted explicitly in the Constitution of Bhutan in 2008, to guide its economic governance. (Full article...)
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  The mythological Judgement of Paris required selecting from three incomparable alternatives (the goddesses shown).

  
  Decision theory or the theory of rational choice is a branch of probability, economics, and analytic philosophy that uses expected utility and probability to model how individuals would behave rationally under uncertainty. It differs from the cognitive and behavioral sciences in that it is mainly prescriptive and concerned with identifying optimal decisions for a rational agent, rather than describing how people actually make decisions. Despite this, the field is important to the study of real human behavior by social scientists, as it lays the foundations to mathematically model and analyze individuals in fields such as sociology, economics, criminology, cognitive science, moral philosophy and political science. (Full article...)
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  Becker in 2008

  
  Gary Stanley Becker (/ˈbɛkər/; December 2, 1930 – May 3, 2014) was an American economist who received the 1992 Nobel Memorial Prize in Economic Sciences. He was a professor of economics and sociology at the University of Chicago, and was a leader of the third generation of the Chicago school of economics.
  
  Becker was awarded the Nobel Memorial Prize in Economic Sciences in 1992 and received the United States Presidential Medal of Freedom in 2007. A 2011 survey of economics professors named Becker their favorite living economist over the age of 60, followed by Kenneth Arrow and Robert Solow. Economist Justin Wolfers called him "the most important social scientist in the past 50 years." (Full article...)
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  Eli Filip Heckscher (24 November 1879 – 23 December 1952) was a Swedish political economist and economic historian who was a professor at the Stockholm School of Economics.
  
  He is known for the Heckscher–Ohlin theorem, an influential model of international trade that predicts that capital-abundant countries export capital-intensive goods, while labor-abundant countries export the labor-intensive goods. (Full article...)
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  Marx in 1875

  
  Karl Marx (German: [ˈkaʁl ˈmaʁks]; 5 May 1818 – 14 March 1883) was a German philosopher, social and political theorist, and revolutionary socialist. He developed the theory of historical materialism, analysing societal structure and change, particularly class struggle under capitalism, and predicting the system's ultimate replacement by communism. Marx co-authored The Communist Manifesto (1848) with Friedrich Engels, and undertook a critique of classical political economy in his magnum opus, Das Kapital (1867–1894). His ideas and their later development, collectively known as Marxism, have had enormous influence on intellectual, political, and social history, and have inspired revolutionary movements in many countries.
  
  Born in Trier in the Kingdom of Prussia, Marx earned a doctoral degree in philosophy from the University of Jena in 1841. He became involved in radical journalism and was influenced by the philosophy of Georg Wilhelm Friedrich Hegel and the Young Hegelians, whose ideas he critiqued in works such as The German Ideology. In Paris, Marx wrote his Economic and Philosophic Manuscripts of 1844 and began a close collaboration with Engels. After moving to Brussels, they were active in the Communist League, and in 1848 wrote The Communist Manifesto, which lays out a programme for revolution. Expelled from Germany after the Revolutions of 1848, Marx moved to London, where he wrote his Grundrisse notebooks and the three volumes of Das Kapital. He became a leading figure in the International Workingmen's Association (First International), in which he battled the influence of anarchists led by Mikhail Bakunin and celebrated the Paris Commune of 1871. In his late studies and his Critique of the Gotha Programme (1875), Marx theorized on the transition to a communist society. He died in 1883 and was buried in Highgate Cemetery. (Full article...)
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  William Stanley Jevons FRS (/ˈdʒɛvənz/; 1 September 1835 – 13 August 1882) was an English economist and logician.
  
  Irving Fisher described Jevons's book The Theory of Political Economy (1871) as the start of the mathematical method in economics. It made the case that economics, as a science concerned with quantities, is necessarily mathematical. In so doing, it expounded upon the "final" (marginal) utility theory of value. Jevons's work, along with similar discoveries made by Carl Menger in Vienna (1871) and by Léon Walras in Switzerland (1874), marked the opening of a new period in the history of economic thought. Jevons's contribution to the marginal revolution in economics in the late 19th century established his reputation as a leading political economist and logician of the time. (Full article...)
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  From an economic perspective, contract theory studies how economic actors can and do construct contractual arrangements, generally in the presence of information asymmetry. Because of its connections with both agency and incentives, contract theory is often categorized within a field known as law and economics. One prominent application of it is the design of optimal schemes of managerial compensation. In the field of economics, the first formal treatment of this topic was given by Kenneth Arrow in the 1960s. In 2016, Oliver Hart and Bengt R. Holmström both received the Nobel Memorial Prize in Economic Sciences for their work on contract theory, covering many topics from CEO pay to privatizations. Holmström focused more on the connection between incentives and risk, while Hart on the unpredictability of the future that creates holes in contracts.
  
  A standard practice in the microeconomics of contract theory is to represent the behaviour of a decision maker under certain numerical utility structures, and then apply an optimization algorithm to identify optimal decisions. Such a procedure has been used in the contract theory framework to several typical situations, labeled moral hazard, adverse selection and signalling. The spirit of these models lies in finding theoretical ways to motivate agents to take appropriate actions, even under an insurance contract. The main results achieved through this family of models involve: mathematical properties of the utility structure of the principal and the agent, relaxation of assumptions, and variations of the time structure of the contract relationship, among others. It is customary to model people as maximizers of some von Neumann–Morgenstern utility functions, as stated by expected utility theory. (Full article...)

Did you know...

• ... that the 1983 Spanish floods were the most economically damaging in Spain until the 2024 Spanish floods?
• ... that scientists from the Institutum Divi Thomae raised silkworms at Saint Gregory Seminary during World War II as a form of economic warfare against Japan?
• ... that the Canadian journalist Bernard Descôteaux is credited with the economic revival of the independent newspaper Le Devoir?
• ... that people are robbing Lebanese banks to get their own money back?
• ... that anti-Korean sentiment, due to South Korea's economic growth, motivated Djuna to write the sci-fi novel Counterweight?
• ... that Michael Kremer's O-ring theory of economic development was inspired by his forgetting to purchase toilet paper for a training session?

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Selected images

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  John Maynard Keynes, who is considered the "father of macroeconomics" (from Economics)
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  The Marxist critique of political economy comes from the work of German philosopher Karl Marx.
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  Median income by country (from Economics)
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  An example production–possibility frontier with illustrative points marked (from Economics)
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  A 1638 painting of a French seaport during the heyday of mercantilism
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  Milton Friedman (from Economics)
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  Pollution can be a simple example of market failure; if costs of production are not borne by producers but are by the environment, accident victims, or others, then prices are distorted.
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  The U.S. unemployment rate from 1990 to 2022 (from Economics)
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  São Paulo Stock Exchange in Brazil, an electronic trading network that brings together buyers and sellers through an electronic trading platform
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  The publication of Adam Smith's The Wealth of Nations in 1776 is considered to be the first formalisation of economic thought.
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  List of countries by gross domestic product (PPP) per capita in April 2022 (from Economics)
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  A map showing the main trade routes for goods within late medieval Europe (from Economics)
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  The circulation of money in an economy in a macroeconomic model. In this model, the use of natural resources and the generation of waste, such as greenhouse gases, is not included. (from Economics)
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  Economists study trade, production, and consumption decisions, including those that occur in a traditional marketplace.
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  An environmental scientist sampling water
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  A basic illustration of a business cycle (from Economics)
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  The supply and demand model describes how prices vary as a result of a balance between product availability and demand. The graph depicts an increase in demand from D₁ to D₂ and the resulting increase in price and quantity required to reach a new equilibrium point on the supply curve (S).

In the news

24 August 2026 – Economic impact of the 2026 Iran war

Iranian economic crisis

19 August 2026 – Economic impact of the 2026 Iran war

Iranian economic crisis, Economic D-Day

U.S. president Donald Trump announces an economic war against Iran, along with new sanctions for countries trading with Iran. (The Hill)

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