A discussion on the theories in economics

The Malthusian theory of population has been widely discussed and criticised during the 19th and early 20th century. Do or do not the general equations of the economic equilibrium lead us to this conclusion on theoretical grounds.

Thus the optimum level of population is vague. A lower level of optimum population may be justified from the economic viewpoint, but such a level may be harmful keeping into view the defence considerations of the country. The value of a leveraged firm and the value of an unleveraged firm should be the same.

Endogenous growth theories — Rate of economic growth strongly influenced by human capital and rate of technological innovation.

In aforementioned discussion, we have explained the Harrod-Domar model of economic growth with respect to capital accumulation.

It is only when the actual population exceeds the optimum that the increase in population needs control. Consequently, the cost and price both increases. This point of maximum returns is the point of optimum population. As a result, the growth rate of population increases very swiftly.

Thus the optimum is not a fixed but a movable point. In my Cours it has been possible to throw the mathematical parts into footnotes, and the text can thus be read without hindrance by persons who have no knowledge of mathematics.

They prefer to go in for a baby car rather than a baby. A second approximation will take account of the expense of putting the mechanism of free competition into full play, and will compare this expense with that necessary for establishing some other new mechanism which society may wish to test.

Without giving in detail "the complex development" of my critic's argument, it may be characterized as equivalent to the proposition that it is always possible to show that within given limits the ordinates of a straight line will be larger than those of a given curve.

Those who censure political economy for pursuing this method seem to be unaware of the fact that all sciences, without exception, must follow this method. I cannot, for my part, sufficiently admire this portion of his work, but I must add that I entirely disagree with him on what he has to say in his work entitled Etudes d'economie sociale.

For this purpose colonialism was required for Britain. The increase in the production capacity in a particular period increases the income for coming years. People readily adopt family planning devices.

Any rise or diminution in the size of the population above or below the optimum level will diminish income per head. It is better to know that the earth is nearly round than to imagine that it is a flat surface.

The market power theory of inflation represents one extreme end of inflation. This has been an important factor behind the economic growth in Asia. The first part of the argument is of use only as drawing the conclusions from certain hypotheses, and says nothing as to their validity as statements of concrete facts.

The argument is that we need to keep economies open to the forces of change. Keynesian theory subdued stimulate the economy through government money. Jul 30,  · All economic theories used to explain specific situations or problems in the economy of some of its models. These models of economic systems try to explain the situation and solve it using approaches that are typical of the economic theory (eg/5().

The New Theories of Economics. Published: Journal of Political Economy, volume 5, ?. Another perfectly valueless discussion is the one on the question as to whether it is preferable to use the term "factors of production" or the term "coefficients of industry." Let us suppose that four hectares are needed to produce eighty hectolitres of.

theories was central to Popper’s thinking. He viewed theory as metaphysics if it is not testable. Archibald and Lipsey (), economics colleagues of Popper at LSE, wrote a remarkable rst-year economics text book in which they put Pop-per’s methodology into practice by emphasising the testable predictions of.

Structural Theories of Inflation: Apart from the two extreme ends mentioned in the above, there is a middle group of economists called structural economists.

According to structural theory of inflation, market power is one of the factors that cause inflation, but it is not the only factor. The optimum theory is superior to the Malthusian theory because it studies the population problem in relation to the economic conditions of a particular country.

(2) Malthus had a narrow vision.

He related the growth of population to food supply. The 50 Most Important Economic Theories, by Donald Marron [ ] on August 17, at pm Donald Marron I love the fact that WordPress decided the most similar post in all of WordPress-land is one about the failures of string theory in physics.

A discussion on the theories in economics