Principles of Economics
DOI link for Principles of Economics
Principles of Economics book
This chapter introduces the "economic way of thinking," primarily through the study of supply/demand and the logic of prices. Economics is haunted by more fallacies than any other study known to man. Perhaps common economic myths are more comparable to the old notion that illness was caused by "bad blood" and that slicing open a vein to drain off some blood could increase someone's chances of recovering from pneumonia or other serious disease. Of course, both economic growth and environmental regulations are affected by government policies and hence political elections. Economic truths are a good deal easier to understand than quantum physics. Economics takes as given that people respond to incentives in a generally predictable manner. The economic way of thinking is simply to take this idea of predictable response to incentives and relentlessly follow it to its logical conclusions. Public education has generally failed to inform the citizenry concerning economic policy.