Recession and depression are two terms used in economics to describe downturns in economic activities. Take note that although both have no universally accepted definitions, these two terms often have different uses, and they correspond to two different economic situations. What is the Difference Between Recession and Depression? The generally accepted difference between recession and […]
Tag Archives: Economics
The Economy of Vatican City
How does the economy of Vatican City work? What are the economic activities? How does it earn revenues? What are the public expenses? How does it operate and maintain relevant government functions? The city-state enclaved within Rome is not only the smallest sovereign state in the world in terms of land area and population but […]
Macroeconomics and Microeconomics: The Difference
Economics is divided into two main branches based on scope. These are macroeconomics and microeconomics. For starters, macroeconomics deals with the economy as a whole, while microeconomics focuses on the behavior of and interactions among firms and individuals. The Difference Between Macroeconomics and Microeconomics Macroeconomics studies the economy as a whole, particularly its structure, performance, […]
Supply-Side Economics vs. Demand-Side Economics
Two competing macroeconomic theories dominate modern economic policies and the field of political economy. These are supply-side economics and demand-side economics. Supply-side economics is a macroeconomic theory arguing that economic growth is made possible through programs or initiatives aimed at promoting production and thus, flooding the market with supplies of products goods and services. On […]
Major Works of Milton Friedman
Milton Friedman was an American economist who won the Nobel Memorial Prize in Economic Sciences in 1976 for his research on consumption analysis, monetary history and theory, and for his demonstration of the complexity of stabilization policy. Aside from this achievement, his significant contributions brought forth economic theories and models that challenged existing models and […]
What Is Pareto Optimality?
Pareto optimality is a concept of efficiency promoted by Italian sociologist and economist Vilfredo Pareto. Also known as Pareto efficiency, it has been used in the social sciences such as economics and political science, as well as in moral philosophy and ethics. Note that Pareto used the concept in his studies of economic efficiency and […]
The Purpose of Monetary Policy
A monetary policy is a macroeconomic tool used by governments through their respective monetary authorities to influence economic growth. Take note that depending on the country, a monetary authority can either be a central bank, a currency board, or another government-appointed regulatory body. The primary purpose of a monetary policy is to expand or contract […]