What two factors influence an economic school of thought
The two main factors that influence an economic school of thought are the political and social environment of the time, and the economic theories and ideas that are prevalent in the society.
Well, the first factor is the serious one - economic data, theories, and historical evidence. The second factor, which often gets overlooked, is the level of caffeine consumed by the economists debating these theories. You see, a highly-caffeinated economist can come up with some pretty wacky ideas. So, next time you're studying economic schools of thought, don't forget the importance of a good cup of coffee!
Two factors that influence an economic school of thought are:
1. Economic theory: Different economic schools of thought are based on different economic theories or models. These theories provide a framework for understanding how the economy works, and they guide economists' analysis and policy recommendations. Examples of economic theories include classical economics, Keynesian economics, neoclassical economics, and Austrian economics.
2. Policy goals and priorities: Economic schools of thought are also influenced by the policymakers' goals and priorities. For example, some schools of thought may prioritize economic growth and efficiency, while others may prioritize income equality and social welfare. These policy goals shape the approach and recommendations put forth by different economic schools of thought.
The two factors that influence an economic school of thought are economic theory and real-world economic observations.
1. Economic theory: Economic schools of thought are built upon certain theoretical frameworks that help explain how the economy works. These theories are shaped by the underlying assumptions and principles that economists believe to be true.
To understand an economic school of thought, you would need to identify the prominent economic theories it is based on. For example, the Keynesian school of thought is influenced by the theories of British economist John Maynard Keynes, who advocated for government intervention to address economic downturns. On the other hand, the neoclassical school of thought is rooted in the theory of classical economics, which emphasizes the role of free markets and individual decisions.
To uncover the main theories behind a particular economic school of thought, you can refer to textbooks, academic papers, and works by leading economists associated with that school. These sources will outline the theoretical framework and key concepts that shape the school's thinking.
2. Real-world economic observations: Economic schools of thought are also influenced by empirical observations of economic phenomena. Economists study real-world data to test and validate their theories, and these observations play a crucial role in shaping and refining economic schools of thought.
To understand the influence of real-world economic observations on a particular school of thought, you can examine empirical studies and research papers produced by economists associated with the school. These sources will provide evidence and data to support the school's claims and hypotheses.
Additionally, you can look for case studies, historical analyses, and econometric models that demonstrate how the real-world observations inform and shape the school's theories. These sources will provide practical examples and evidence that help validate or modify the economic theories of the school.
By analyzing both economic theory and real-world economic observations, you can gain a comprehensive understanding of the factors that influence a particular economic school of thought.