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The Methodology of Positive Economics. Price Theory; The Marshallian Demand Curve The ‘Welfare’ Effects of an Income Tax and an Excise Tax. Monetary Theory and Policy; The Effects of a Full-Employment Policy on Economic Stability: A Formal Analysis A Monetary and Fiscal Framework for Economic Stability The Case for Flexible Exchange Rates
According to Kaldor, “The purpose of a theory of economic growth is to show the nature of non-economic variables which ultimately determine the rate at which the general level of production of the economy is growing, and thereby contribute to an understanding of the question of why some societies grow so much faster than others.” [2] [1]
Positive economics as a science concerns the investigation of economic behavior. [4] It deals with empirical facts as well as cause-and-effect relationships. It emphasizes that economic theories must be consistent with existing observations and produce precise, verifiable predictions about the phenomena under investigation.
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 ...
In these macroeconomic models with sticky prices, there is a positive relation between the rate of inflation and the level of demand, and therefore a negative relation between the rate of inflation and the rate of unemployment. This relationship is often called the "New Keynesian Phillips curve".
Price theory was a significant aspect of his legacy as a teacher, and he taught the subject from 1946 to 1964 and again from 1972 to 1976. Notable economists who took Friedman's price theory course include James M. Buchanan , Gary Becker , and Robert Lucas Jr. , all of whom later became Nobel laureates.
Engel's argument is formalized in neoclassical consumer theory, which conceives of the relationship between income and consumption patterns in terms of utility optimization. In such models, consumers allocate their expenditures to goods and services with the highest marginal utility. After basic needs are satiated, the marginal utility from ...
Endogenous growth theory holds that investment in human capital, innovation, and knowledge are significant contributors to economic growth. 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 ...